If you're somewhat new to investing, the term “growth stocks" may be confusing. After all, don't we want every stock we own to increase in price (and value)?
Of course you do. But the term growth stocks has a specific meaning for investors. These are stocks that generate earnings per share (EPS) that consistently outperform an index, like the S&P 500 index. That's because earnings growth is the best predictor of future stock price growth.
In the next five years, analysts project a median EPS growth rate of 8.5% for stocks in the S&P 500 index. Therefore, if you own an exchange-traded fund like the SPDR S&P 500 ETF Trust (NYSEARCA: SPY), you can expect to get a return of about 8.5% on your investment.
That will let you sleep well at night. But if you're a more aggressive investor, you want more growth. In this special presentation, we analyze seven stocks that analysts project may have EPS growth of higher than 8.5% over the next 10 years. As you'll notice, many of these stocks are blue-chip names that may already be components of the SPY. But owning them individually lets you concentrate your gains on these outperformers.
Click the "Continue to Slide #1" button to view the first company.
