Having a fast grower in your portfolio can keep your share gains rolling along with your dividend income. Here are four high growth companies that could be the powerhouses of your returns. You don't need to have all four for a diversified portfolio. Possibly a combination of one large-cap and one mid-cap may be one way to go.
They are priced at generally high price-earnings ratios, but they potentially can give much more than your average stock.
— Large-cap
REA Group Limited (ASX: REA) has grown to become the nation's number one online real estate listings market leader, surpassing domain.com.au, which is owned by Fairfax Media Limited (ASX: FXJ). Property sellers want to be on the site that gives them the best chance to sell their home. The company has a number of different income streams and strong pricing power. It's expected to grow earning about 27% each year over the next two years. The stock's price-earnings ratio is 37 and dividend yield is 1.5% fully franked.
Ramsay Health Care Limited (ASX: RHC), the leading operator of private hospitals in Australia, as well as having an extensive international network of hospitals and medical centres, came out with an amazing full year result. Underlying net profit climbed 19% on top of a 17.5% increase in revenue. Recent acquisitions have increased its hospital network to 151. It is also expanding a number of its current facilities to maintain business growth. Consensus forecasts are for earnings to grow 17% annually over the next two years. The focus on growth is impressive. It has a 1.8% fully franked yield.
— Mid-cap
Sirtex Medical Limited (ASX: SRX) develops liver cancer treatments that specifically can target cancerous cells amongst healthy tissue. There's a possibility its treatments may become a "first line" treatment that patients would routinely receive along with chemotherapy and radiation. If clinical trial results suggest that use next year, the company's production would have to expand rapidly to handle the increased orders. That would be a step-change up in production and potential earnings.
Because of this, its price-earnings ratio is 48, but everyone will have to wait to see if the trials are successful. If it disappoints, the share price could deflate quickly. Still, the growth potential is great because of the large US and German markets it works in.
Domino's Pizza Enterprises Ltd. (ASX: DMP): The stock had another strong year and now the pizza producer's stock has climbed to about $25 a share. It is planning a continued expansion of its Domino's pizza chain in Japan, which was one of the main growth drivers in FY 2014. There is still room to grow in Australia as well. A steady roll out of new stores is behind earnings growth of 23% forecast annually in the next two years. The stock offers a 1.6% fully franked yield.
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