3 top growth shares I want in my portfolio

Because I have a higher than average tolerance for risk, I’m a big fan of growth shares and you’ll find many in my portfolio.

But in order to maintain a reasonably balanced portfolio, I can’t buy all the growth shares that I would like.

However, three candidates for my next purchase are listed below. Here’s why I’m interested in buying them:

A2 Milk Company Ltd (ASX: A2M)

This infant formula and dairy company’s shares have come under a spot of selling pressure over the last couple of months and are down 25% from their 52-week high. Investors hit the sell button in a panic after a2 Milk Company’s explosive growth just wasn’t quite as explosive as some had hoped. I think the selloff has been an overreaction and has created a buying opportunity for patient investors. As I mentioned last week, Goldman Sachs expects the company to grow earnings by a compound annual growth rate of 53% through to FY 2020. I think this makes its shares good value at 33x estimated FY 2019 earnings.

Aristocrat Leisure Limited (ASX: ALL)

I am a big fan of this gaming technology company and believe it could be the best growth share on the local market at this point. This is largely down to management’s decision to push into the digital gaming market with two sizeable acquisitions. The good news is that this decision appears to be paying dividends. In its last update the company revealed that it now had a massive 8.3 million daily active users of its digital segment, contributing significant recurring revenues. I believe that this fast-growing digital segment will complement its strong core business and lead to stronger-than-average earnings growth over the coming years.

Webjet Limited (ASX: WEB)

Another growth share on my shopping list is this online travel agent. I’m a big fan of the way management positioned its numerous brands to achieve bookings growth well ahead of the industry average over the last couple of years. The good news is that management appears confident this can continue over the medium term, putting Webjet in a position to grow its top and bottom lines at a strong rate for the next couple of years at least.

Three more growth shares that are on my shopping list are here. Here's why I think they are buys.

The Disruptors: 3 Revolutionary Aussie Companies to Back for 2018

We’re living in one of the most exciting times in investing history. Innovation and a booming culture of entrepreneurship are constantly creating new companies with the potential to make forward-thinking investors very rich. Now more than ever, one small, smart investment could make a huge difference to your wealth.

That’s why at The Motley Fool we’ve been scrutinizing the ASX to uncover the kinds of companies that we believe could turn into the next Atlassian.

We’ve found three exciting companies that we believe re poised to perform in the new year. Click here to uncover these ideas!

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of A2 Milk. The Motley Fool Australia has recommended Webjet Ltd. 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 Scott Phillips.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

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 Financial Services Guide (FSG) for more information.