With interest rates being just 2.5% and the ASX still some way off record highs, you'd think it would be fairly straightforward to find growth stocks that trade at a reasonable price. Indeed, the global macroeconomic outlook is reasonably upbeat and so there should be an abundance of them. However, it seems as tough as ever to find companies that offer the potent mix of growth and decent value, but here are three stocks that seem to manage just that.
Greencross Limited
It's been a superb three months for investors in Greencross Limited (ASX: GXL), with the pet centre and veterinary clinic provider seeing its share price rise by 24%. This compares very favourably to the ASX, which is flat over the same time period. However, Greencross could extend its gains, since the company is forecast to increase its bottom line at a rapid rate this year, with EPS set to rise by 46% in the year to June 2015. Despite this, it trades on a PEG ratio of just 0.4 – growth at a very reasonable price indeed.
G8 Education Ltd
Like Greencross, G8 Education Ltd (ASX: GEM) has made notable gains in recent months, with shares in the childcare centre provider being up 13% in the last three months alone. Part of the reason for this could be the market looking ahead to improved prospects during the rest of this year and next year, when G8 is expected to grow its bottom line by a whopping 82%, followed by growth of 40% next year. However, such phenomenal growth isn't as expensive as you may think it is, since G8 trades on a PEG ratio of just 0.4.
M2 Group Ltd
After a disappointing start to 2014, M2 Group Ltd (ASX: MTU) has come back strongly to gain 9% in the last three months. However, that could just be the start, since profitability is due to pick up strongly at the telecoms company during the remainder of this year. Indeed, M2 Group is forecast to grow its EPS by 15% in the current year to June 2015, which is well ahead of the wider index's growth rate. As with Greencross and G8, though, investors aren't being asked to overpay for strong growth prospects, since shares in M2 trade on a PEG of just 0.3.
