The definition of “best growth stocks” differs significantly among investors. For some, it’s as simple as identifying the stocks that are riding a bull market better than most others and offering exceptional returns for the time being. Other investors look into the long-term viability of a stock’s growth patterns and factors influencing its short-term and long-term growth triggers.
There are great growth picks in virtually all healthy and even stagnant markets. Sometimes, you can even find strong growth when the market is crashing. The current market is no exception, and if you are looking to invest $5,000 in a couple of growth stocks, there are two that should be on your radar.
An engineering and professional services firm
WSP Global (TSX:WSP) is counted among the largest engineering firms in the world. Unlike many of those firms that top the list because of their products and associated services, WSP Global relies upon its consultancy services for revenue generation. It has a massive global presence, and its clients and resources (professionals) hail from several different markets around the globe.
It has experienced steady organic growth, sustained and supported by steady financials. However, a significant proportion of the company’s growth can be attributed to its acquisitions.
As a growth stock, WSP Global offers a compelling combination of pace and consistency. It has risen by over 500% since June 2014 and has grown over 20% this year alone (so far). If it continues to grow at this rate, the stock may easily double its investors’ capital in the next four years. Its overall return potential also includes dividends, but it has a relatively minimal impact.
An energy company
TerraVest Industries (TSX:TVK) cannot be considered a pure-breed energy company for two reasons: its business model and past performance.
The business model of the company highly relies upon the energy sector because one of its operating domains is storage (vessels) and transportation solutions for liquefied petroleum gas (LPG), natural gas liquids (NGL), and ammonia. These fluids represent both energy sector inputs and outputs.
But TerraVest also has a solid presence in the residential and commercial markets, where it offers heating solutions. This diversified product mix is partly responsible for its disassociated performance from the rest of the energy sector.
TerraVest stock has been growing almost consistently (and quite steadily) over the past decade, unlike the energy sector as a whole, which experienced a major slump between 2014 and 2020, which few stocks managed to recover.
Similarly, the stock didn’t experience a major bullish phase like other energy stocks in the post-pandemic market, which may be followed by a correction.
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Foolish takeaway
The two stocks have returned over 600% (WSP) and 800% (TVK) in the last decade. Even if they perform half as well in the coming decade and you invest $2,500 each in the stock now, your $5,000 capital may grow to about $17,500 in the next 10 years. Both stocks also pay dividends, which enhances the growth potential.
