3 NZX growth stocks that can be worth exploring in October 2021

Highlights 

• Growth stocks are stocks of companies that produce profits at a much faster pace than other companies in the same industry.
• South Port NZ achieved an after-tax profit of $10.71 million, up 13.6% in FY21.
• Kathmandu Holdings refreshed its strategy to lead global brand growth and strengthen ESG leadership.

A growth stock is a stock of a firm that has a considerably higher growth rate and generates positive cash flow at a quicker pace than its peers in the same industry. These stocks are from firms that have a lot of room to expand.

Investors purchase growth stocks with the expectation of profiting from capital gains when they sell their shares in the future. They are, nevertheless, viewed as risky since they benefit by obtaining a large market edge through ambitious business ideas.

Let’s cast a glance at how these 3 growth stocks are performing.

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 Fletcher Building Limited (NZX:FBU, ASX:FBU)

Building products manufacturer, Fletcher Building, reported a strong FY21 experiencing the minimal impact of COVID-19. The Group posted an NPAT of $305 million, up from a loss of $196 million in FY20 and an EBIT of $669 million in FY21.

The Group paid a final dividend of 18cps on 17 September 2021. Fletcher remains well placed to deliver future performance and growth.

ALSO READ: What are Fletcher’s (NZX:FBU) strategies ahead?

Fletcher also appointed 2 new executives, Bruce McEwen as its Chief Executive, Digital Foundations, and Teresa Rendo as Chief Executive, Distribution.

On 1 October, FBU ended the trading session at $7.13, down 0.7% from its previous close.

South Port New Zealand Limited (NZX:SPN)

NZ’s southernmost commercial deep-water port, South Port NZ, achieved a pleasing result and achieved an after-tax profit of $10.71 million in FY21, up 13.6% on FY20 and ahead of its guidance.

A record 53,750 TEU were handled through the Port even after an 8% decline in container vessel cells. While bulk cargo volumes improved by 5.9%, container numbers also rose by a remarkable 13.3%.

RELATED READ: Which are the 5 best performing NZX growth stocks?

SPN estimates that its earnings in the next financial year will stay consistent with reported earnings this year.

On 1 October, SPN ended the trading session at $9.35, up 1.63% from its previous close.

Kathmandu Holdings Limited (NZX:KMD; ASX:KMD) 

Kathmandu Holdings is a clothing and equipment provider for travel and adventure. KMD’s business was affected by travel curbs related to COVID-19 in FY21.

However, the Group’s result was bolstered by strong sales performance from RipCurl and Oboz, propelled by participation growth in hiking and surfing. The Group reported a 35.9% rise in underlying EBITDA to $113.3 million in FY21, propelled by strong sales performance and focused management of operating expenses.

ALSO READ: 4 NZX travel and tourism stocks to consider in Q4

The Group aims at increasing its global presence, bringing new and innovative products, investing in online capabilities and maintain a flexible balance sheet ahead.

On 1 October, KMD ended the trading session flat at $1.59.

Bottom Line

Selecting a growth stock is contingent on the investing style of the investor.

(NOTE: Currency is reported in NZ Dollar unless stated otherwise)