High-growth investing is one of the most popular stock plays in the world, with buyers getting in low and selling high. While some plays are risky and call for careful portfolio monitoring, which can be very time consuming, others are more long term. Here is a selection of the very best quality high-growth stocks currently trading on the TSX.
While the stocks here have poor value multiples, they all have huge earnings growth projected. Would-be investors could wait for prices to dip or get in where they can. Let’s have a look now and see which industry can give you the best bang for your buck. Will it be silver, weed, or tech?
Your silver play for the day
First Majestic Silver Corp. (TSX:FR)(NYSE:AG) is overvalued today at over three times its future cash flow value, and its P/B of 1.8 times book suggests overvaluation when compared to industry and market averages.
But you don’t come to a high-growth stock like this for its value. You come for its 100.9% expected annual growth in earnings. That’s right: +100%. Low debt and other health indicators make this a good choice for the risk-averse commodities investor. While some analysts have been calling for a stalled silver market, the fact is that this is a highly sought-after commodity with prices that will sky rocket sooner or later.
It’s 4:19 — anybody got a minute?
Our pick of the pot stocks for today is Canopy Growth Corp. (TSX:WEED)(NYSE:CGC). A little overvalued compared to its future cash flow value, but still giving investors the munchies, Canopy Growth is a wonder stock right now. Never mind that it’s trading at of 5.7 times its book price — this power stock has 70.3% expected annual growth in earnings ahead of it.
While industry performance remains to be seen, it’s a fairly safe bet that legalized marijuana is going to be a big deal when it hits the high streets. Recent proposed changes to the Ontario market are likely to make for a more competitive outlook.
The clock’s ticking on tech…
Coming through for the tech stock team, Ballard Power Systems Inc. (TSX:BLDP)(NASDAQ:BLDP) is your high-growth power play today. It’s overvalued by almost four times its future cash flow value and changing hands at a high P/B of 4.7 times book, but never mind what poor value it is today. Ballard Power Systems is looking at 72% expected annual growth in earnings, and that means big winnings down the line.
With very low debt (less than 10%) and a great balance sheet all round, Ballard Power Systems is a stock to be proud of if you hold it in your portfolio. Huge demand in the power cell sector make its growth look assured.
And the winner is…
Silver. A coming surge in demand for silver in the tech and battery industry plus the potentially massive electric vehicle market make the prospects for this commodity look assured. Our choice today is nice and healthy, which should mitigate any concerns would-be investors might have. A silver bull is still coming, so stay invested in the grey stuff.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Victoria Hetherington has no position in any of the stocks mentioned.