3 High Growth Shares On My Watchlist

By | January 5, 2017

3 High Growth Shares for Long Term Hold on my Watchlist

It seems most people are after a quick fix or easy money when it comes to their portfolio. I’m not looking for money right now, I’m looking for high growth for the long term. That is my goal. For me, I want my shares to grow and for my dividends to grow. That means that not only will my stock value be worth more, but the dividends they pay will be significantly higher.

 

High Growth Stock Criteria

  • Listed on Australian Securities Exchange (ASX)
  • Experienced management team
  • Forward looking thinking
  • Increasing Sales and Positive outlooks

These are just some of the criteria I look at when I am analyzing a stock that I wish to purchase. I am looking for continued growth not only in the business model but in their dividend payments too. I like companies that have organic growth, this means there is a natural need for their product in the market place without having to ram it down the throats of the people they are trying to get to buy their product. Organic growth in a long term hold situation is very important as this will allow the shares to grow in value naturally without forceful tactics and with limited drawbacks.

 

My Share Watchlist – 3 High Growth Shares

Codan Limited – CDA – CDA 2,13 -0,07 -3,18%

While Codan were absolutely smashing the stock market in 2013 there were a few disappointing releases made that hurt the share price. Codan has since been slowly picking away at that stock price, increasing it ever so slowly. Codan have a few different sources of income, the main ticket is the sale of Mine Lab metal detectors. This has been a huge success for Codan and continues to prove why the Codan shares should be on the watchlist. Codan’s business model makes sense, more high quality products on the market means a higher revenue. This company has a high organic growth not only for hobbyist but for military installations also.

Codan has a current PE ratio of 22.96 and a gross fully franked dividend yield of 4.24%.

For me, Codan is on my watchlist, although, I definitely would like to get in at a price that is significantly lower than the current Share Price of $2.11.

 

Genesis Energy Limited NZ – GNE – GNE 1,99 -0,03 -1,49%

Genesis Energy Limited are a New Zealand based reseller of electricity. Typically these sort of shares do not have a huge amount of growth unless there is a major acquisition in the books or a total market domination. Genesis holds a large portion of the electricity customers in NZ and plans to extend this base dramatically over the next 4 years. Up to 2021 Genesis expect their revenue to grow from a little over 300 million per year to over 400 million p.a. This represents roughly 33.3% increase over 4 year or 8.325% p.a. If they are able to achieve these numbers then this will mean a higher dividend growth and possibly a higher share price.

Genesis also fit the criteria for an organic business, as everyone needs to use electricity and the price of power becoming more expensive every year, this company could prove to be a winner over the long run. However, I do have a few concerns with this company. That being, the shares are not fully franked, the dividend yield is quite high and renewable energy and the commercialization of home-powered battery devices are becoming more a reality everyday.

Genesis Energy are a good company to look out for as they are currently trading on a PE ratio of just 11.21, have an unfranked dividend yield of 7.42%. Genesis expects to grow revenue dramatically, only time will tell if they can actually achieve this. Current Price – $2.03

 

Generation Healthcare REIT Units – GHC – GHC 1,90 0,00 -0,26%

Generation Healthcare Reit Units are a Real Estate Investment Trust but with a twist, they do not focus on residential, commercial, business etc. No, they focus on Healthcare as the name suggests. GHC are the only listed REIT unit that focus’ on healthcare units. GHC have interests in private hospitals, clinics and other healthcare related property. GHC have a portfolio of  17 high quality healthcare properties, located in Victoria, Queensland and New South Wales.

This company has organic growth not only in the price of private hospitals increasing but the company is proactively seeking new investment opportunities in the form of privatized hospitals or other healthcare property. This compounded with the ever aging population of Australia will lead to amazing price growth and better dividend growth.

Generation Healthcare REIT Units are currently trading at a PE ratio of 18.33 and have an unfranked dividend yield of 4.61%. Current Price is $1.92.

 

These three shares will be on my watchlist for a while. I am looking for an entry position and as my budget is tight, I would like to get them for the cheapest possible. Let me know what you think about these shares and their potential growth for the next 5, 10, 20, 30+ years!

 

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4 thoughts on “3 High Growth Shares On My Watchlist

  1. Mr. All Things Money

    I love utilities and Reits. In the US most utilities are regulated and therefore, earnings are predictable as they can raise rates to cover any shortfall. They have monopoly in their specific geographies. However, due to slower growth, I like to buy them when they are really cheap and when dividend is at least 4% and DGR is over 2%.

    Reits are my other favorites. One thing to note about REITs is that you need to look at their FFO or AFFO to correctly determine valuation as their earnings are deflated due to depreciation of properties and hence hence why their PEs are extremely inflated.

    BTW, many years ago I owned NZT (New Zealand telecom), it was a good stock with great dividend. I think they changed their name or something. They were traded on US exchange as a ADR.

    Reply
    1. Buy - Hold - Long Post author

      I like both utilities and reits too as they are dependable and reliable incomes. Especially when it comes to utilities they can afford a large amount of debt because they basically know their income. Thanks for the comment.

      Reply
    1. Buy - Hold - Long Post author

      GHC has some serious previous growth. I like it for the long term prospects with more pressure going to be on the healthcare industry. I believe they will be double that price in 5-10 years. Does that mean double the dividend? Hopefully.

      Reply

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