High-growth stocks that are financially stable are attractive for many reasons. They provide a strong upside to your portfolio, with less likelihood of downside risks compared to less financially robust companies. Analysing the most recent financial data, I’ve created a list of companies that compare favourably in all criteria, making them potentially good additions to your portfolio.
Veris Limited (ASX:VRS)
Veris Limited operates as a diversified infrastructure and survey solutions company in Australia and internationally. The company provides employment to 360 people and with the company’s market cap sitting at AUD A$67.25M, it falls under the small-cap category.
VRS is expected to deliver an extremely high earnings growth over the next couple of years of 83.27%, driven by a positive revenue growth of 8.23% and cost-cutting initiatives. An affirming signal is when net income increase also comes with top-line growth. Even though some cost-reduction initiatives may have also pushed up margins, in the case of VRS, it does not appear too severe. This prospective profitability should trickle down to shareholders, with analysts expecting the company to generate a positive return on equity of 13.01%. VRS ticks the boxes for robust growth generation on all levels of line items, which makes it an appealing stock to dig into deeper. Thinking of investing in VRS? Take a look at its other fundamentals here.
Lovisa Holdings Limited (ASX:LOV)
Lovisa Holdings Limited operates as a fashion jewelry retailer. Founded in 2010, and run by CEO Steven Doyle, the company employs 855 people and with the company’s market capitalisation at AUD A$918.89M, we can put it in the small-cap stocks category.
LOV is expected to deliver an extremely high earnings growth over the next couple of years of 12.15%, driven by a positive double-digit revenue growth of 28.73% and cost-cutting initiatives. An affirming signal is when net income increase is supported by top-line growth. Since net income isn’t artificially inflated by one-off initiatives such as cost-cutting, we know this profit growth is more likely to be sustainable. This prospective profitability should trickle down to shareholders, with analysts expecting the company to generate a high double-digit return on equity of 72.30%. LOV’s bullish prospects on both the top and bottom lines make it an interesting stock to invest more time to understand how it can add value to your portfolio. Should you add LOV to your portfolio? Take a look at its other fundamentals here.