- A growth stock is a stock of a company that is known to deliver a substantial and sustainable positive cash flow going forward.
- Such a stock’s revenues and earnings are expected to increase at a faster rate than the average company within the same industry.
- Growth stocks generally pay smaller dividends.
A growth stock is a stock of a company that is known to deliver a substantial and sustainable positive cash flow going forward. Such a stock’s revenues and earnings are expected to increase at a faster rate than the average company within the same industry.
Growth stocks generally pay smaller dividends. The retained earnings are reinvested by the firm’s earnings in capital projects. There are a few companies listed on the ASX that can offer good bets to investors looking for growth, especially when coronavirus-related restrictions are lifted by next year.
Here are three ASX-listed growth stocks for 2022:
Temple & Webster Group Ltd (ASX:TPW)
The stock of online furniture and homewares retailer has given a year-to-return (YTD) of nearly 16%.
The company sees significant growth potential in the sector for itself in the next decade and has been investing heavily in its offline and online businesses. It is due to increasing online penetration rates and its leadership position online.
ASX Growth Stocks for 2022
In the full-year results for the 12 months ended 30 June, the company reported a record 85% rise in on-year revenue to AU$326.3 million. EBITDA surged by 141% to AU$20.5 million. Temple & Webster Group reported a record 165% rise in net profit after tax (NPAT) to AU$14 million.
According to the company’s estimates, just 7% to 9% of category sales were made online last year. It compares to 25.3% in the US in 2020.
ELMO Software Ltd (ASX:ELMO)
ELMO Software offers cloud-based human resource and payroll solutions for organisations. The company has reported strong growth in past few years, including the COVID-19 pandemic period.
In FY 2021, the annualised recurring revenue (ARR) jumped 52.1% to AU$83.8 million. The company’s management has an annual recurring revenue (ARR) guidance of AU$105 million to AU$111 million.
The stock has given a negative year-to-return (YTD) of nearly 29%.
PointsBet Holdings Ltd (ASX:PBH)
A corporate bookmaker, PointsBet Holdings Ltd has operations in Australia and New Jersey (the US).
PointsBet ended FY 2021 on a high note. For the 12 months ended 30 June, it reported a 228% increase in full-year turnover to AU$3,781.4 million.
The company expects to continue with the same momentum in 2022 due to the rising popularity of mobile sports betting, innovative products, and its continued US expansion.
The stock has given a negative year-to-return (YTD) of over 11%.
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