Finding the right growth stock these days has been hard for Motley Fool investors. One will start climbing higher and higher, but lead to a huge drop that investors then take to heart and sell out of fear. This continues to create a volatile situation in the market, with investors not knowing where to turn.
But here I’ll discuss two stocks, one growth stock that you should consider as a long-term investment, and another that you may want to sell for now, and own a stake in once more down the line.
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A growth stock to buy
Not all tech stocks are bad, and there’s one growth stock I would consider a win for any portfolio. That’s Constellation Software (TSX: CSU), a software company that’s earned a strong reputation as an acquisition king. Furthermore, it’s been around the block for quite some time. So whereas its tech peers continue to try and catch up to its profitable performance, Motley Fool investors can look forward to years of strong growth.
And that growth has indeed been strong. In the last decade, shares of Constellation stock have grown 2,236%! That’s a compound annual growth rate of about 37% as of writing, which is pretty much unheard of in the tech sector. And that’s because it has what other tech stocks don’t: a proven track record of stellar performance.
The company continues to grow its acquisition portfolio, continues to bring in revenue, and continues to even provide a dividend. Again, no other growth stock in the tech sector offers that. So I would certainly buy this growth stock as a long-term hold for your portfolio.
One to ditch…for now
The other growth stock that’s done incredibly well may fall very soon. Nutrien (TSX: NTR)(NYSE: NTR) is a top growth stock thanks to owning the market share of the fertilizer industry. And the ongoing crisis in Ukraine has led to sanctions against Russia, which provides crop nutrients that Nutrien stock has taken over.
This, however, is not a long-term solution. Russia has always touted cheaper prices for crop nutrients, oil, and gas and the like. So it’s likely that income will divert back when the crisis comes to an end. That could lead to a crash in share prices as Nutrien continues to soar past all-time highs.
But don’t get me wrong. Nutrien is still a growth stock I would consider buying when a drop happens. Unfortunately, it’s just still too new of a company to provide much of a track record. Right now it’s situational growth rather than performance growth increasing its share price. So it may not last long. But when a dip does happen, I’d buy it up in bulk and hold on for decades.
Foolish takeaway
These two companies are strong stocks that have seen immense growth in the last few years, and even months. But while one has a proven track record of immense growth, the other has only been lately. So it’s clear where Motley Fool investors should put their cash today.
