Best Growth Stocks To Buy Now In Top Sectors For 2018

best 2018 growth stocks
If you are looking for the best growth stocks to buy now, this list of stodgy stalwarts from top sectors is worth checking. For one, all of them have strong near-term growth prospects. Second, some of them provide meaty dividends as well. The DJIA and the S&P 500 have raced past 25,000 and 2,700, respectively. Stocks of commodity-related and economically-sensitive companies are leading the market. Energy and technology stocks are up 6.2% and 4.7%, respectively. Analysts are busy upping earnings expectations after President Trump signed the Tax Cuts and Jobs Act into law in late December.

The size and direction of the impact, however, vary by company. Analysts expect companies in the financial sector to benefit the most from the tax cut. According to FactSet, they have raised 2018 EPS estimates by 8.3% for companies in the financial sector, higher than any other sector. Benefit from tax cuts is only one part of a sector's story.

Other factors also play a part in sector-level EPS growth estimates. So, which sectors do analysts expect to show the highest growth in 2018, Earnings are expected to grow in all 11 sectors. Earnings growth is expected to be strongest in the energy and financial sectors. Earnings growth is expected to be less robust in interest-rate sensitive sectors like utilities and telecom services. The best sector from an earnings growth perspective in 2018 is energy. Sector heavy-weights Exxon Mobil, Chevron, and Schlumberger along with a host of smaller companies are expected to show strong growth in earnings.

Since its streak began, it has consistently raised dividends by approximately 15% annually. At this rate, Open Text will double dividends in less than five years. On a forward P/E basis, the company’s payout ratio falls below 20%. An investment in Open Text is appropriate for both growth and income investors.

Since 2007, it has made two dozen acquisitions which has propelled annual revenue growth of 14% over the same time period. In 2018, it is expected to grow earnings by 30% over the previous year. Another newcomer, Manulife Financial lands the number 19 spot on our list of the best Canadian dividend stocks.

After years of dividend stagnation, Manulife has once again become a reliable dividend growth company. This past February, the company announced a 7% dividend raise, its fifth consecutive year of dividend growth. As a result, the company will regain its status as a Canadian Dividend Aristocrat. On a forward P/E basis, the company’s payout ratio is only 32%. Manulife has plenty of room to keep its dividend streak alive.

Once forgotten, insurance companies are making a comeback thanks to rising interest rates. Over the past five years, Manulife has grown core earnings by a compound annual growth rate (CAGR) of 15%. Asia has been a bright spot for the company. Manulife’s wealth asset management (WAM) segment has also enjoyed significant growth.

WAM assets under management have grown by 20% annually over the past five years and the segment’s earnings have grown by an average of 15% over the same time frame. As the economy strengthens and interest rates rise, Manulife is well positioned to reward income investors. One of the best Canadian dividend stocks to own today is Goeasy Limited. Goeasy is a full-service provider of goods and alternative financial services.

It operates in two segments: easyfinancial and easyhome. Goeasy has quietly become a dividend growth company. A new entry on the dividend list, its 58% anticipated growth rate through 2019 also landed the company on our Top Growth Stocks list. The company’s dividend has more than doubled since 2014. In February, the company raised dividends by 25% and marked the fourth consecutive year of dividend growth.

Despite the rapid pace of dividend growth, its payout ratio is still sitting at a respectable 36%. There is no doubt that the company will become a Dividend Aristocrat next year as it has ample room for further dividend growth. The company’s easyfinancial segment has been fueling the company’s growth.

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