The 5 Growth Stocks you need to be investing in right now

Understanding growth stock selection to win

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Underlying every great investment is some sort of growth. Growth of revenues, growth of profits, growing margins, growing free cash flow... there is always some underlying growth for a rising share price.

Small caps

I look for the companies with rising revenues (at least 20% YoY), rising margins and that are on the cusp of profitability or with accelerating profitability for the biggest share price jumps. Companies that do not have rising margins are often just taking on debt to juice growth numbers or have executives who are engaging in a big skim into their own pockets.

Midcaps

Are essentially similar to small caps but further along the "S curve" and should be successfully challenging bigger companies.

Large Caps


Growth can be slower, but they must have a strong balance sheet and good outlook. Look for strong R&D that offer other catalysts to grow.
I am looking for companies with growth rates of at least 15% in most cases, and higher for smaller companies.

Follow the money

Our VSLs lists of Mega Cap, Growth, Dividends, International Stocks and Global ETFs are chosen because they aligned to the major secular trends unfolding in today's economies globally.

Companies not aligned and that are being disrupted by new technologies will go the way the way of the dinosaurs if they do not adapt and change.

Massive GOVT stimulus, incentives, regulation and penalties are what can change the timing of secular trends i.e. speed them up or slow them down — think 'follow the money' .

The pace of change brings challenges — and opportunities

Climate change

As climate change continues to be at the forefront of government and corporate priorities, we keep a keen eye on how this influences government policy and the activity of large investment funds.

Ageing demographics

With the retirement of the baby boomers, the workforce will continue to shrink, in turn driving up wages. We look to see how healthcare and AI can improve the quality of aged care coupled with productivity improvements.

Technological change

We look for how technology can bring productivity gains and better ways of working to increase quality of life. We believe fast adopters of Artificial Intelligence (AI) will prevail over those who are laggards.

Global debt

Massive corporate debt will make it hard for one-third of all companies to refinance during the next recession. We focus on companies with growing revenues and decreasing debt obligations.

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Understanding growth stocks

  • Every portfolio needs growth. The stocks on our Growth Very Short List (VSL) are companies that all show the ability to at least double in the next five years, but generally have potential to triple or more.
  • There are not many "growth" companies on the S&P 500 as few have high growth rates as they are already big, and many are cyclical which require some slow handed position trading. A combination of growth and value with strong intermediate to long-term runways. I am looking for companies with growth rates of at least 15% in most cases, and higher for smaller companies.
  • Most of the S&P 500 companies worth owning pay a dividend and appear in our Dividend Stocks list of the VSL
    Mid-Cap stocks reside on the S&P 600 midcap index, or Russell 1000 with a market cap over $10 billion. These are generally the stocks that find their way onto the S&P 500 sooner than later.
  • I look for Russell 2000 stocks with the potential for very high growth and stock appreciation.
  • Microcap growth stocks are highly volatile. I only include those I think have a likelihood of Russell 2000 inclusion this year or next year. Inclusion into the Russell 2000 ETFs (IWM) (VTWO) results in forced institutional buying and generally have a BIG step higher in price and market cap, as well as cheaper cost of capital which is good for the business.
  • Growth stocks are volatile and can be heavily influenced by traders in the short-term, we use oversold conditions to scale into great businesses.

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Kirk is an outstanding analyst and a great source of investment ideas in all types of markets. Over the four years I subscribed to his service, I’ve realised impressive returns on Berkshire Hathaway, Palantir and Marathon Digital to name just a few. Kirk focused me on space stocks which I would never have considered on my own. Spire Global and AST Space Mobil have been 2X and 3X returns for me in just the last 12 months. Kirk is also a great investment coach constantly keeping his clients focused on economic trends and market risks that could devastate a less well-informed retail investor’s portfolio

— Dorward W

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