I’m a strong believer in the notion that investors who buy shares that are reasonably priced and have the ability to grow earnings at a faster rate than the broader market will achieve market beating returns.

It sounds like a pretty simple strategy but it has proven to be highly effective over the long term.

With that in mind, here are four shares that I think investors should consider when thinking about how to beat the broader market averages:

Sirtex Medical Limited (ASX: SRX) – Despite a recent dip in sales growth, Sirtex still remains one of the fastest growing companies on the ASX and has the potential for huge gains if clinical trials go to plan. Only 2% of Sirtex’s addressable market has been penetrated at this stage and there is hope its novel liver cancer treatment could be expanded into new areas such as kidney cancer. Investors should remember that Sirtex’s share price can be extraordinarily volatile at times and this makes it suitable only for investors with a higher than average risk appetite.

Retail Food Group Limited (ASX: RFG) – Retail Food Group shares have been on an upward trend over the past few months but I think there could be further gains to come. The company owns brands such as Gloria Jeans, Donut King and Crust Pizza and is also one of Australia’s largest coffee roasters and wholesalers. Earnings growth has really ramped up over recent years thanks to acquisitions and international expansion and the company is likely to deliver growth of around 20% when the company reports its FY16 results later this month. The shares are trading on a price-to-earnings (P/E) ratio of 14.5 which seems like good value when you consider this is a significant discount to the broader market.

Healthscope Ltd (ASX: HSO) – The healthcare sector has unsurprisingly become very popular amongst investors on the basis that the demand for healthcare services is expected to grow strongly over the next decade or so. This has seen hospital operators like Healthscope and Ramsay Health Care Limited (ASX: RHC) trade on relatively expensive valuations. Despite this, I think there could be further long term upside for Healthscope with the company investing heavily in expanding its hospital footprint to meet future demand. On a relative basis, it also trades at a discount to Ramsay Health Care, although this is unsurprising considering Ramsay Health Care’s superior track record.

Magellan Financial Group Ltd (ASX: MFG) – Investors who believe that the global economy isn’t going to fall off a cliff and that equity markets will continue to perform strongly, should consider adding Magellan to their portfolio. The international fund manager has proven to be a wonderful performer, both as a stock, and as a fund manager that has the ability to beat the market averages. Magellan also provides investors with leveraged exposure to global equity markets without the need to invest directly overseas. The shares have performed quite strongly over the past three weeks, but any move back towards the $20 level would be a buying opportunity in my opinion.

Do you want to learn how you can improve your long term wealth using lessons from one of the greatest investors of all time?

How 1 Man Made 100x His Money After 50

Few know, that as Warren Buffett blew out the candles on his 50th birthday cake, he had just 1% of his current fortune. Think about it: At an age when most give up hope, Buffett was just getting started on the remaining 99% of his fortune. Goes to show you that it's never too late for you to potentially get rich. Which is why we've gathered the strategies we learned from Buffett, distilled them down to 11 simple lessons, and put it in an exclusive report for you to claim. Just click here to learn more about this handy investing guide.

HOT OFF THE PRESSES: Motley Fool’s #1 Dividend Pick for 2017!

With its shares up 155% in just the last five years, this ‘under the radar’ consumer favourite is both a hot growth stock AND our expert’s #1 dividend pick for 2017. Now we’re pulling back the curtain for you... And all you have to do to discover the name, code and a full analysis is enter your email below!

Simply enter your email now to receive your copy of our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2017.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our https://www.fool.com.au/financial-services-guide">Financial Services Guide (FSG) for more information.

Motley Fool contributor Christopher Georges owns shares of Retail Food Group Limited and Sirtex Medical Limited. The Motley Fool Australia owns shares of Retail Food Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.