How to Successfully Invest in Growth Stocks

2021-06-11

Investing In Growth Stocks

Investing in growth stocks are very different than investing in ordinary stocks.  As a result, they are valued differently.  As Mr. Valuation I often talk about the importance of investing with a margin of safety.  This is especially important when investing with companies of average or ordinary growth potential.  However, the margin of safety concept is very different when investing in a true growth stocks.  I define growth stocks as companies that have historically grown earnings at 15% a year or better and are expected to continue doing that in the future.  Powerful growth provides its own kind of a margin of safety.

Understanding the difference between growth stocks and ordinary stocks is achieved by the understanding of the power of compounding.  The time use of money is a key investing concept.  Growth stock investing collapses time which dramatically accelerates your rate of return.  In this video I will present 7 growth stocks that have achieved tremendous historical results for longtime shareholders.  More importantly, 6 of these companies appear to possess the opportunity to continue doing that in the future.  The one that does not, does provide a very important lesson which is why it is included.

The 7 stocks I will be covering in this video are:  Lithia Motors (LAD), LKQ Corp (LKQ), Alibaba Group (BABA), Facebook (FB), Starbucks (SBUX), Etsy (ETSY), Amazon (AMZN)

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Investing in Growth Stocks Portfolio Review

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Disclosure: Long LKQ and AMZN at the time of writing.

Disclaimer: The opinions in this document are for informational and educational purposes only and should not be construed as a recommendation to buy or sell the stocks mentioned or to solicit transactions or clients. Past performance of the companies discussed may not continue and the companies may not achieve the earnings growth as predicted. The information in this document is believed to be accurate, but under no circumstances should a person act upon the information contained within. We do not recommend that anyone act upon any investment information without first consulting an investment advisor as to the suitability of such investments for his specific situation.

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