Technology stocks are staples in growth portfolios because of their eye-popping revenue growth, but technology isn’t the only sector of the stock market that boasts fast-growing companies. For example, many healthcare stocks are growing at rates that Silicon Valley would envy. In fact, these stocks all reported year-over-year sales growth north of 100% in the first quarter of 2018.
Are these stocks worth including in your portfolio?
Top Canadian Stocks To Buy Right Now: AbbVie Inc.(ABBV)
Our first pick is AbbVie Inc (NYSE:ABBV). This North Chicago, IL-based company has an Earnings ESP of +0.24% and a Zacks Rank #3.
The stock has seen the Zacks Consensus Estimate for first-quarter 2018 earnings being pegged at $1.78 per share. Besides this, the company boasts an encouraging earnings track record, exceeding expectations in all the last four quarters with an average beat of 1.81%.
Top Canadian Stocks To Buy Right Now: Amazon.com, Inc.(AMZN)
Hey, I’m as big a fan of Jeff Bezos and Amazon.com Inc. (NASDAQ:AMZN) as anyone, but how on earth did the world’s biggest e-commerce company beat analyst estimates by 157%?
I’ll admit I love using analysts for sound bites in my coverage of public companies but there’s something definitely wrong when a business on as big a roll as AMZN gets a Q1 2018 estimate of $1.27, 21 cents lower (!?!) than the year before.
Are these men and women not reading Amazon’s financial reports?
If you are an Amazon shareholder, the one thought you should have after examining its first-quarter results is: Please keep losing money internationally — the unit had a $622 million operating loss in the quarter, 29% higher than a year earlier — because we know what happened with its North American e-commerce business after losing lots of money; it’s now making lots of money.
Throw in its AWS business which grew operating margins by 140 basis points year-over-year while pulling down $1.4 billion in operating profits and I’m not sure there’s an argument against owning its stock for the next 10-30 years.
Top Canadian Stocks To Buy Right Now: Facebook, Inc.(FB)
Following iRobot, Facebook reports its first-quarter results on Wednesday. As usual, the bar is high for Facebook. In Facebook’s fourth quarter, revenue climbed 47% and adjusted earnings per share surged 83%. In addition, Facebook’s user base grew to 2.1 billion people using it every month and 1.4 billion people using it daily. The results capped off a year of excellent financial performance.
But Facebook also admitted during the last earnings call that 2017 "was also a hard year" in some ways. "We’ve seen abuse on our platform, including interference from nation states, the spread of news that is false, sensational and polarizing, and debate about the utility of social media," said Facebook CEO Mark Zuckerberg in the company’s fourth-quarter earnings call. Problems were exacerbated in March when Facebook announced that a third-party developer had mishandled user data.
In 2018, Facebook will most likely try to renew user and advertiser confidence. Beyond looking for more strong revenue growth, look for Facebook to comment on how recent developments will impact its guidance for spending on security and safety.
Top Canadian Stocks To Buy Right Now: Clarke(T)
With its big yield, history of delivering regular dividend growth, and a non-prohibitive valuation, AT&T is a stock that’s worth building a super-long-term position in. The telecom giant’s yield comes in at 5.7%, and a 34 year history of delivering annual payout growth and massive cash flow suggest there’s a good chance the company will continue to raise its payout.
The company’s stock performance has been tepid in recent years due to pressures in both the wireless and television spaces. Competition from budget priced rivals like T-Mobile has put pressure on mobile service sales and the rise of cord-cutting and skinny bundles is impacting the performance of its DirecTV subsidiary. AT&T has been leveraging its advantage when it comes to bundling mobile, internet, and television services to create meager sales growth, but it’s also taking hits when it comes to its margin.
The good news is that the company may be able to reclaim pricing strength and create new revenue streams with the introduction of 5G networks. 5G is the next generation of wireless internet technology, and it’s on track to deliver dramatic speed increases that will pave the way for better consumer-level service and a range of new technologies including connected cars, augmented-reality hardware, and smart-city devices.
Another positive catalyst on the horizon is its pending acquisition of Time Warner — so long as it survives an antitrust suit from the Department of Justice. If AT&T is allowed to integrate the entertainment company, it’ll diversify into a new space and open up new bundling and advertising opportunities that could do a lot to brighten its long-term earnings trajectory.
Shares trade at just 10 times forward earnings estimates and nine times this year’s projected free cash flow. With its top-notch dividend profile and the company making some smart moves to fortify its business, AT&T looks like a smart long-term play.
Top Canadian Stocks To Buy Right Now: Lam Research Corporation(LRCX)
Lam Research is a designer and manufacturer of semiconductor processing equipment used in the fabrication of integrated circuits. The company is recognized as a leading supplier of front-end wafer processing equipment to the worldwide semiconductor industry. Despite this existing leadership position, LRCX is slated to witness massive earnings and revenue growth soon.
Based on current consensus estimates, we expect Lam Research to post EPS growth of 75.8% and net sales growth of 38.0% this fiscal year. Meanwhile, the firm is generating cash flow growth of 45.8% and RoE of 41.1%. LRCX is also sporting a Zacks Rank #1 (Strong Buy) right now.