Home Capital Group And Other Top Growth Stocks
Investors seeking to increase their exposure to growth should consider companies such as Home Capital Group and Canadian Zinc. Analysts are generally optimistic about the future of these stocks, based on how much they’re expected to earn and return. Below I’ve put together a list of great potential investments for you to consider adding to your portfolio if growth is a dimension you would like to firm up.
Home Capital Group Inc. (TSX:HCG)
Home Capital Group Inc., through its subsidiary, Home Trust Company, provides deposits, mortgage lending, retail credit, and credit card issuing services in Canada. The company size now stands at 816 people and with the market cap of CAD CA$1.15B, it falls under the small-cap group.
HCG is expected to deliver a triple-digit high earnings growth over the next couple of years, driven by a positive double-digit revenue growth of 36.51% and cost-cutting initiatives. An affirming signal is when net income increase also comes with top-line growth. Even though some cost-reduction initiatives may have also pushed up margins, in the case of HCG, it does not appear extreme. This prospective profitability should trickle down to shareholders, with analysts expecting the company to generate a positive return on equity of 6.89%. HCG’s impressive outlook on all aspects makes it a worthy company to spend more time to understand. Thinking of investing in HCG? Check out its fundamental factors here.
Canadian Zinc Corporation (TSX:CZN)
Canadian Zinc Corporation engages in the exploration and development of natural resource properties in Canada. Canadian Zinc was founded in 1965 and with the company’s market capitalisation at CAD CA$43.91M, we can put it in the small-cap stocks category.
CZN’s projected future profit growth is an exceptional 89.98%, with an underlying 87.27% growth from its cash flow from operations expected over the upcoming years. Profit growth, coupled with operating cash flow expansion, is a positive indication. This is because net income isn’t artificially inflated by unsustainable activities such as one-off cost-reductions expected in the future. CZN’s impressive outlook on all aspects makes it a worthy company to spend more time to understand. Interested to learn more about CZN? Other fundamental factors you should also consider can be found here.
Roots Corporation (TSX:ROOT)
Roots Corporation, together with its subsidiaries, provides a portfolio of apparel, leather goods, accessories, and footwear for men, women, and children under the Roots brand. Founded in 1973, and run by CEO James Gabel, the company now has 2,200 employees and has a market cap of CAD CA$395.04M, putting it in the small-cap category.
ROOT is expected to deliver a triple-digit high earnings growth over the next couple of years, driven by a positive double-digit revenue growth of 32.66% and cost-cutting initiatives. An affirming signal is when net income increase also comes with top-line growth. Even though some cost-reduction initiatives may have also pushed up margins, in the case of ROOT, it does not appear extreme. Furthermore, the 55.88% growth in operating cash flows indicates that a large portion of this earnings increase is high-quality, day-to-day cash generated by the business, rather than one-offs. ROOT’s bullish prospects on both the top and bottom lines make it an interesting stock to invest more time to understand how it can add value to your portfolio. Considering ROOT as a potential investment? Have a browse through its key fundamentals here.
For more financially robust companies with high growth potential to enhance your portfolio, use our free platform to explore our interactive list of these stocks.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
