Companies that expand their revenues and earnings at a higher rate than the market average are considered growth stocks. Growth companies may appear to be costly, but their valuations may be low if they continue to rise.
These businesses aren't recognised as good dividend payers since they prefer to invest their cash flow on expanding their business.
Let’s have a look at the performance of these 5 NZX-listed growth stocks.
Metro Performance Glass Limited (NZX:MPG)
Metro Performance posted solid results for FY21 with a resilient performance in the NZ market. The Group’s revenue dropped 2% YOY in the 10 months from June 2020 to March 2021, while statutory NPAT improved from $78.9 million in FY20 to $8.5 million in FY21.
Metroglass further bolstered its financial position in 2021 by reducing its net debt by $18.9 million to $48 million. The Board intends to resume dividends alongside its FY22 interim results.
Source: Copyright © 2021 Kalkine Media
MPG shares returned 169.45% in the past 1 year and were trading at $0.425, up 1.19%, on 25 May, at the time of writing.
Despite COVID-19 limitations, Kathmandu Holdings had a strong first half of FY21.
In 1H FY21, the Group recorded an NPAT of $22.3 million, up from $7.6 million on pcp. Strong sales growth from Rip Curl and Oboz boosted the company's profitability and brand value.
The Group declared 2cps as interim dividend, due to be paid on 4 June 2021. The Group expects benefits from synergies and cost-out initiatives to deliver around $15 million of annual savings in FY21.
KMD shares returned 59.28% in the past 1 year and were trading at $1.52, up 1.33%, on 25 May, at the time of writing.
Michael Hill International Limited (NZX:MHJ)
Michael Hill posted an 11.6% rise in all-store sales and 16.4% increase in the same store sales for the quarter ended 28 March 2021. Further, its digital sales grew tremendously, up 69% in the said period as compared to Q3FY20.
Moreover, the company observed a strong cash position with at least NZ$50 million at the quarter end.
MHJ shares returned 158.68% in the past 1 year and were trading flat at $0.86 on 25 May, at the time of writing.
Steel & Tube Holdings Limited (NZX:STU)
Steel & Tube Holdings reported a 33% upturn in EBIT and a 40% rise in operating cashflow in the first six months to 31 December 2020.
Image Source: Copyright © 2021 Kalkine Media
The Board resumed dividends with an interim dividend of 1.2cps, given the reversal in performance and a better economic outlook.
The Group expects strong residential and infrastructure performance, and an advancing manufacturing sector ahead.
STU shares returned 78.33% in the past 1 year and were trading at $1.11, down 0.89%, on 25 May, at the time of writing.
Turners Group performed effectively during COVID-19, keeping its end of the deal. TRA noted marginal growth and solid demand in Auto retail as a result of continuing simplification of both the retail footprint and buying processes.
The Group anticipates an NPAT of at least $35 million in FY21, compared to NPBT forecast of $33 million to $38 million.
TRA shares returned 115.93% in the past 1 year and were trading at $3.9, up 2.36%, on 25 May, at the time of writing.
(NOTE: Currency is reported in NZ Dollar unless stated otherwise)