4 Stocks I’d Buy If I Had $10,000
By Ryan Newman
Buying high-quality growth stocks and holding onto them for the long term can be one of the greatest ways that ordinary people can build incredible wealth.
That’s because, by acquiring the shares when a promising company is still in its early days – and remaining patient over the years, while taking advantage of all the dividends paid along the way – an investor can let the power of compounding work its magic.
This strategy not only gives you a good chance at beating the returns of the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO), but can also position you to grow a serious nest egg.
Here are the 4 companies I would buy (or top-up on!) if I had $10,000 to invest…
- Greencross Limited (ASX: GXL) is a provider of veterinary services that’s expanding rapidly across Australia – both with its vet clinics and retail stores. The company recently announced it is acquiring CF Group Holdings Pty Ltd (“City Farmers”), which should further strengthen its position in the Western Australia market. While the stock is currently trading on a forecast P/E ratio of 40, strong growth is anticipated in the coming years and the shares also offer a dividend in the 1.4% range.
- M2 Group (ASX: MTU) is an excellent way for investors to gain access to Australia’s booming telco industry, and has plenty more room for growth ahead than the much larger Telstra (ASX: TLS). Armed with subsidiaries like Dodo and Primus, M2 Group can expand organically over the coming years and is a solid bet for the ultra-long term.
- Yellow Brick Road Holdings (ASX: YBR) is a wealth management group very early in its growth days. In fact, the company hasn’t even achieved profitability yet (it anticipates a maiden profit in 2015). With interest rates set to remain low for some time yet, demand for Yellow Brick Road’s services should continue to strengthen. Now seems like a fantastic time to climb on board with shares trading around 68 cents.
- Nearmap Limited (ASX: NEA) could well be the riskiest stock to make this list, given its lofty trailing P/E ratio of around 40 and tiny market cap of around $140 million. However, Nearmap has enormous growth potential both in Australia and overseas as a provider of ultra-high resolution aerial photographs. Its maps and birds-eye photos are arguably even better than those provided by Google!
Yet an even better bet could be this top dividend stock
Each of the companies mentioned above have the potential to deliver enormous returns over the coming years. While I currently own Yellow Brick Road shares, the others are sitting firmly on my watch list and could well be my next target should I come into a windfall…
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