With the market dropping around 7% in 2018, it wasn’t hard to be a market beater last year.
This year I’m optimistic that it will be a very different story for the All Ordinaries (Index: ^AXAO) (ASX: XAO) index, which may mean it takes something special to be a market beater.
Three shares which I think have the potential to do this are listed below. Here’s why I’m tipping them for big things in 2019:
Appen Ltd (ASX: APX)
The shares of this global leader in the development of high-quality, human annotated datasets for machine learning and artificial intelligence may have smashed the market in 2018, but I don’t think for a second that it is too late to invest. Given how the machine learning and artificial intelligence markets are expected to grow significantly over the next decade, I believe Appen is likely to experience growing demand for its services for some time to come. This could mean its strong earnings growth continues for the foreseeable future.
Collins Foods Ltd (ASX: CKF)
Collins Foods could be a great option for investors in 2019 thanks to the continued expansion of its KFC network in Europe and Australia and the roll out of the Taco Bell brand across several Australian states. The latter came about after a successful trial in Queensland gave management the confidence to believe that Australia is finally ready for Taco Bell after a number of false starts in the past. I believe this has positioned the company well to grow both its earnings and dividend at an above-average rate over the coming years.
Costa Group Holdings Ltd (ASX: CGC)
Costa is a leading horticulture company growing avocados, berries, citrus fruit, mushrooms, and tomatoes. Due to management’s focus on production expansions and acquisitions, Costa has achieved strong earnings growth in recent years. The good news is that management appears confident that this strong run will continue over the next three to five years. It recently reaffirmed its guidance for low double digit NPAT-S growth for the 12 months ending June 30 and reconfirmed its long-term guidance for an average trajectory of low double digit annual average NPAT-S growth over a three to five-year period.
Motley Fool contributor James Mickleboro owns shares of Collins Foods Limited. The Motley Fool Australia owns shares of and has recommended COSTA GRP FPO. The Motley Fool Australia owns shares of Appen Ltd. The Motley Fool Australia has recommended Collins Foods 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 Scott Phillips.