If you're willing to buy stocks with big growth expectations at what may seem to be high prices in hope of a big gain, then read on about these four companies…
Oil Search Limited (ASX: OSH) has a big stake in the PNG LNG project which just started producing LNG. When the project reaches full production within two years, Oil Search estimates its production output will be four times greater. That great change should cause earnings to surge. There's even scope to add more LNG processing facilities and double that high output once again later on. That may really drive its shares up over the coming years.
Telstra Corporation Ltd (ASX: TLS) is looking to partner up with a number of international telecom and tech companies. With billions of dollars at its disposal, it wants to become a regional leader in Asia, so it plans to be part of a big "intercloud" network being set up by US based Cisco Systems (NASDAQ:CSCO). Japan's largest telco, NTT, would also like to work with Telstra to create a bigger regional data network. Overall it looks like Telstra can grow even more in Asia and the US.
Domino's Pizza Enterprises Ltd. (ASX: DMP) will be doubling its Japan franchise network within the next five years, up to about 600 stores. That will have a big impact on earnings. It still has room to set up new stores in Australia as well, so the growth story hasn't stopped at home. Investing in expanding chain stores can be a great way to win big returns when they are in their high growth phase.
Sirtex Medical Limited (ASX: SRX) could be on the verge of potentially tripling its production of its specialised liver cancer treatment product. It all depends on the results of a clinical trial expected to be complete around June 2015. If its SirSpheres product is suggested to be usable as a "first line" cancer treatment by the trials, the company's revenue and earnings could rocket up in a short time.
The stock has a sky-high PE of 47 now, but if it can triple its production over three years, consensus forecasts tip an average 44% earnings gain annually over that time. I think it is perhaps too speculative to buy the stock before the release of the trial's results, but you can follow the story and be ready.
Sometimes we have to wait for big gains, but patience can pay you back many times over. Businesses take time to grow, so you have time to build up a position as you watch the changes come. For example, companies using innovative technology may start out small, but they may not stay that way very long.
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