Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Top 5 Fastest Growing Industry Contenders


The combination of sales and earnings-per-share growth could mean these five companies are headed somewhere.

There's a scene in Forrest Gump where Forrest discovers that his money troubles are over because his partner, Lieutenant Dan, has invested in "some sort of fruit company," a reference to Apple.

The scene, funny as it is, speaks to the dream that seems to follow most investors: Getting in on a growing company and then sitting back and watching the returns roll in. Most families have a story passed down through the ages about how Great Great Great Grandpappy Zeke was in Atlanta in 19-aught-7 and could have gotten in on the ground floor of Coca-Cola for just $500. Alas.

However, while the sort of vision and foresight required to find those companies destined for returns like Apple or Coke is more often than not a mirage, investors shouldn't ignore the potential for sustained growth. So in hopes of finding that stock that will just keep growing and growing the longer one holds it, here's a list of the top five stocks that have shown solid growth in recent years and look to continue the trend.

Each of these companies has shown both sales growth and earnings per share growth exceeding 25% over the last five years, and each has EPS growth that's projected to be higher than 25% next year and over the next five years.

Guidance can be (and often is) wrong, and past performance is by no means a reliable indicator of future performance, but the combination of these factors could mean that these five companies are headed somewhere.

1., Inc. (BIDU)
If people in Forrest Gump's era struggled to understand how a company like Apple could rise to be the second largest in the world by market capitalization, getting them on board with would be nigh impossible. However, Baidu, a Chinese search engine offering services very similar to Google (GOOG) or Wikipedia, has shown solid growth over time. Share value is up almost 900% over the last five years, and the expansive potential of the growing middle class in China appears to be one that Baidu could tap into. Baidu has shown EPS growth exceeding 130% over the last five years and, while it looks to slow down, the company is projected to continue showing consistent profits.

2. Goldcorp Inc. (GG)
What says growth like Canada, right? It's got the room. Well, Goldcorp has been steadily growing for the last five years and appears poised to continue expanding its revenues in the future. What's more, with a price earnings-to-growth of just 0.45, it appears that the stock is available at a relative bargain. The company's shares have gained over 75% over the last five years and, should it continue to show profits, it's possible that those plucky Canadians will just keep showing solid returns.

3. Concho Resources Inc. (CXO)
Concho is an oil and gas drilling exploration company that operates primarily in the Permian Basin of West Texas and southeast New Mexico. The company appears to be benefiting from the oil and gas renaissance in the United States, as EPS growth over the last five years has been over 50% and is projected to stay very close to that level over the next five years. With shares up almost 700% over the last half-decade, Concho could be a solid pick for sustaining growth into the future.

4. Lululemon Athletica inc. (LULU)
Lululemon Athletics is a Canadian company making athletic equipment. Last year was a good one for the designer and retailers, with share prices leaping over 50% since January 2011. This is most likely due to the extremely consistent EPS growth the company has enjoyed for half a decade now. Since 2007, Lululemon has seen its EPS shoot up some 140%.

5. Green Mountain Coffee Roasters (GMCR)
Okay, so David Einhorn clearly disagrees, something that also might speak to the hazards of looking only at growth when scouting potential investments. But Green Mountain didn't become a battleground stock for nothing; the company's K-Cups have proven extremely profitable over time, allowing for EPS growth of over 75% for the last five years and projections of EPS growth exceeding 60% over the next five years.

This article was written by Joel Anderson.

More from

Invest Like a Member of Congress

Home Sweet New Home

The Market's Direction for the Coming Election
< Previous
  • 1
Next >
No positions in stocks mentioned.
Featured Videos