Choosing the right stock to sell from your portfolio can be more challenging than identifying new stocks to add, especially if there is no clear pattern of decline or any obvious danger signs. But it’s a critical element of keeping your portfolio healthy, just as finding the right stocks to buy is.
Right now, two growth stocks should be on your radar as potential buys, and one you may consider selling if it’s in your portfolio.
To buy: FirstService stock
FirstService (TSX: FSV) is the largest property manager in North America, overseeing a massive portfolio of over 9,000 communities, including high-rise condos and single-family HOAs. The other half of the company’s business is outsourced property services like roofing, flooring, painting, etc.
The company has grown rapidly over the years, and the stock has been a powerful grower since its inception in 2015, returning over 500% to investors in less than 10 years. The bull market trend hit a snag in 2021, but the stock is in recovery mode and growing at a decent pace.
The real estate company’s position in the industry, diversified business model, healthy financials, and powerful organic growth make it a compelling growth pick. It would be best to hold the stock long term to benefit from its capital appreciation potential and dividends. However, the latter is not an impressive return dimension because of a low dividend yield.
To buy: NexGen Energy stock
Nuclear power is going through a revival phase around the globe, with 60 new plants under construction and several others planned for the future. Consequently, uranium demand is increasing, and companies like NexGen Energy (TSX: NXE) will ride this positive trend to new heights.
NexGen is more than just a uranium mining stock – it’s one of Canada’s most promising uranium producers.
The uranium producer has an impressive portfolio of assets, including Rook-I in Saskatchewan, which the company fully owns. The company has secured lucrative futures contracts, and Rook-I’s production supply is already booked.
This and other strengths (like low-cost production) have allowed the stock to rise 133% in the last 12 months, and there are no signs that the growth might slow down anytime soon.
To sell: WSP Global stock
It’s important to understand that WSP Global (TSX: WSP) is one of the most promising engineering companies in the world, with a compelling portfolio of professionals and services spread across the globe.
Its growth has been a good reflection of the company’s potential, but a short-seller is currently targeting it. The same short-seller that published a report on Lightspeed, among others, caused the stock to dip to brutal depths.
The short-seller has also published a report on WSP Global, and the focal point is financial strain. It has already caused the stock to dip but has not resulted in a full-scale sell-off yet. It would be smart to look into the report and the company’s financials to make an informed decision about the company before the market sentiment does that for you.
- We just revealed five stocks as “best buys” this month … join Stock Advisor Canada to find out if NexGen Energy made the list!
Foolish takeaway
The two stocks that should be on your radar are both long-term picks, and given enough time (and an adequate amount of capital), they may push your portfolio to new heights. But it’s important to understand that while both companies have strong fundamentals and supportive market conditions, they may still be vulnerable to market sentiment.
