Investors tend to look for stocks that have a strong future outlook. Why invest in something that will grow slower than the rest of the market? In terms of profitability and returns, stocks such as Paylocity Holding and Supernus Pharmaceuticals are expected to outperform its peers in the future. The list I’ve put together below are of stocks that compare favourably on all criteria, which potentially makes them a good investment if you believe the growth has not already been reflected in the share price.
Paylocity Holding Corporation (NASDAQ:PCTY)
Paylocity Holding Corporation provides cloud-based payroll and human capital management (HCM) software solutions for medium-sized organizations in the United States. Formed in 1997, and headed by CEO Steven Beauchamp, the company provides employment to 2,115 people and has a market cap of USD $2.77B, putting it in the mid-cap stocks category.
Extreme optimism for PCTY, as market analysts projected an outstanding earnings growth rate of 50.75% for the stock, supported by an equally strong sales growth of 50.51%. An affirming signal is when net income increase is supported by top-line growth. Since net income isn’t artificially inflated by one-off initiatives such as cost-cutting, we know this profit growth is more likely to be sustainable. Moreover, the 35.53% growth in operating cash flows shows that a decent part of earnings is driven by robust cash generation from operational activities, not one-off or non-core activities. PCTY ticks the boxes for high-growth generation on all levels of line items, which makes it an appealing stock to dig into deeper. A potential addition to your portfolio? Check out its fundamental factors here.
Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN)
Supernus Pharmaceuticals, Inc., a specialty pharmaceutical company, focuses on the development and commercialization of products for the treatment of central nervous system diseases in the United States. Established in 2005, and now run by Jack Khattar, the company provides employment to 422 people and has a market cap of USD $2.36B, putting it in the mid-cap stocks category.
SUPN is expected to deliver a buoyant earnings growth over the next couple of years of 35.06%, bolstered by an equally impressive revenue growth of 63.97%. It appears that SUPN’s profitability may be sustainable as the fundamental push is top-line expansion rather than unmaintainable cost-cutting activities. Moreover, the 21.57% growth in operating cash flows shows that a decent part of earnings is driven by robust cash generation from operational activities, not one-off or non-core activities. SUPN’s impressive outlook on all aspects makes it a worthy company to spend more time to understand. Should you add SUPN to your portfolio? Other fundamental factors you should also consider can be found here.
Jianpu Technology Inc. (NYSE:JT)
Jianpu Technology Inc. operates a platform that provides online discovery and recommendation services for financial products in the People’s Republic of China. Founded in 2011, and now run by Daqing Ye, the company currently employs 669 people and with the company’s market capitalisation at USD $868.35M, we can put it in the small-cap stocks category.
JT is expected to deliver a triple-digit high earnings growth over the next couple of years, bolstered by a significant revenue which is expected to more than double. It appears that JT’s profitability may be sustainable as the fundamental push is top-line expansion rather than unmaintainable cost-cutting activities. We see this bottom-line expansion directly benefiting shareholders, with expected positive return on equity of 16.04%. JT ticks the boxes for high-growth generation on all levels of line items, which makes it an appealing stock to dig into deeper. Interested to learn more about JT? Take a look at its other fundamentals here.
For more financially robust companies with high growth potential to enhance your portfolio, explore this interactive list of fast growing companies.
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.