Successful investing requires delving into a company’s finances and evaluating its prospects. This process may seem tedious, but it allows you to get a better idea of which growth stocks may do well over the long term. Since research requires time and effort, it is good to shortlist a group of stocks that you are comfortable buying for long-term capital appreciation. Ideally, these stocks should have a solid growth track record, a dominant market share, and possess catalysts that can ensure their consistent and continued growth.
As you become more knowledgeable about business, you’ll end up with a set of solid ideas to consider. The next step is to select your best buying ideas first, as these will be your most attractive purchases. When it comes down to it, here are three stocks I’ll pick above the rest for their promising prospects and solid business fundamentals.
Hawkins
Hawkins (NASDAQ:HWKN) is a specialty chemicals and ingredients company that manufactures products for the industrial, water treatment, and health and nutrition sectors. The company has not only demonstrated consistent growth in revenue and net income over the years, but has also paid dividends for 39 consecutive years.
Hawkins saw sales increase from $774.5 million in fiscal 2022 (ending March 31) to $919.2 million in fiscal 2024. Net income increased 46% during this period , from $51.5 million to $75.4 million. Most impressive was the company’s free cash flow generation, which increased more than eightfold, from $14.3 million in fiscal 2022 to $119.3 million in fiscal 2024.
Hawkins’ strong performance continued in the first quarter of fiscal 2025. Sales increased almost 2% year over year to $255.9 million, but operating income managed to increase 22.5% year over year to 39 .8 million dollars. Net income improved 23.3% year-over-year to $28.9 million, and the business also generated positive free cash flow of $6.9 million, continuing its track record of cash flow generation of free cash. In parallel with its strong results, management increased the company’s quarterly cash dividend from $0.16 to $0.18.
Investors can also expect acquisitive growth to drive earnings to the next level. Hawkins demonstrated a strong track record of accretive acquisitions with an average of two per calendar year since 2020. In June and July of this year, the company completed two acquisitions: Wofford Water Service and Intercoastal Trading, both for its water treatment division. . .
Wofford will help Hawkins build a larger customer base in Mississippi, while Intercoastal will help the business expand to the East Coast region. In the industrial and health & nutrition segments, Hawkins will focus on new product development, with a view to growing its specialty branded products supported by its research and development.
garmin
garmin (NYSE: GRMN) is a technology and engineering company that manufactures products for five key sectors: fitness, outdoor, aviation, marine and automotive OEM. The company is known for using global positioning satellite (GPS) technology and incorporating it into its various products such as multi-sport watches, smartwatch devices, and golf devices. Garmin saw its revenue increase from $5 billion to $5.2 billion from 2021 to 2023, while its net income rose from $1.1 billion to $1.3 billion. The business also generated average positive free cash flow of $810 million during this period.
Garmin’s strong results continued in the first half of 2024. Sales increased 17% year over year to $2.9 billion and operating income increased 33% year over year to $640.4 million. Net income increased 17.6% year over year to $576.6 million and the business generated positive free cash flow of $620.3 million. Garmin paid a quarterly dividend of $0.75 per share, raising its annualized dividend to $3. The company has steadily increased its dividend since paying $0.40 per quarter in 2011.
Garmin has raised its full-year revenue guidance and expects revenue to increase 13.8% year over year to $5.95 billion by 2024, demonstrating healthy top-line growth for the accessories company. The company continues to launch innovative new products for its five divisions along with Garmin Pay, which supports contactless payments. With its wide range of products endearing customers, it looks like the business will continue to do well.
symbolic
symbolic (NASDAQ: SYM) is an automation technology company that integrates artificial intelligence (AI) into its platform to solve distribution challenges and supply chain problems. The company helps its customers by implementing solutions to improve the efficiency and accuracy of product delivery to help them achieve cost savings and better workflow. Symbotic saw its revenue nearly quintuple, from $251.9 million in fiscal 2021 (ending September 30) to $1.2 billion in fiscal 2023. Gross profit also skyrocketed sharply from just $10.4 million to $189.7 million during the same period. The company also saw its free cash flow more than double, from $97.4 million in fiscal 2021 to $209.5 million in fiscal 2023.
The technology company continued to report strong results through the first nine months of fiscal 2024. Revenue increased 63.6% year over year to $1.3 billion, while gross profit increased nearly 39% year over year to $181 .7 million dollars. The business also generated positive free cash flow of $18.3 million. Symbotic has 39 systems in deployment, which helped revenue hit a record for the current quarter. Although gross margin was temporarily impacted by implementation delays, Chief Financial Officer Carol Hibbard expects margins to return to historic levels by the fourth quarter of the fiscal year.
There could be more to come for Symbotic. In August, the company spent $8.7 million to acquire Veo Robotics, which deals with intelligent protection of industrial robots. Veo developed a FreeMove 3D depth-sensing computer vision system that Symbotic plans to integrate into its robotic warehouse automation system to increase online productivity with improved human-machine collaboration. Management sees a large useful market for internal supply chains of $432 billion, implying that there are significant opportunities available for Symbotic to expand its reach and continue growing for many years to come.
Should you invest $1,000 in Hawkins right now?
Before you buy shares in Hawkins, consider this:
He Varied and Dumb Stock Advisor The analyst team has just identified what they believe are the 10 best stocks for investors to buy now… and Hawkins was not one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when NVIDIA made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you would have $743,952!*
Stock Advisor provides investors with an easy-to-follow success plan, including guidance on how to build a portfolio, regular analyst updates, and two new stock picks each month. He Stock Advisor the service has more than quadrupled the return of the S&P 500 since 2002*.
See the 10 actions »
*Stock Advisor returns from September 23, 2024
Royston Yang has no position in any of the stocks mentioned. Motley Fool has positions and recommends Garmin. The Motley Fool has a disclosure policy.
If I Could Only Buy 3 Stocks in the Back Half of 2024, I’d Pick These was originally published by The Motley Fool