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79.2 Reasons That May Make Prudential plc A Buy

Today I am detailing why I think Prudential (LSE: PRU) (NYSE: PUK.US) is a fantastic pick for those seeking a top-notch growth stock.

Dependable growth set to keep on rolling

Shares in life insurance behemoth Prudential have marched steadily higher since the end of the summer, rising almost 20% in just over two months, and the company has clocked up a 48% gain in the year to date. Investors love the firm’s broad track record of double-digit earnings growth in recent years, and Prudential’s pan-global operations look set to keep earnings moving higher. Indeed, earnings per share expected to climb to 79.2p in 2013, according to current City projections.

Prudential’s extensive exposure to emerging markets has been earmarked as a major earnings driver in future years. The company saw pre-tax profit from its operations in Asia rise almost 18% in January-June, to £512m. Strength in the US also helped drive performance during the period, and profits here rose around 34% during the period to £616m, but the company is targeting Asia to provide the next step in its growth story.

As part of the huge rebalancing taking place in the world economy, Asia is expected to deliver $21tn (£13.5tn) of GDP over the next two decades, the equivalent of six new economies the size of Germany,” chief executive Tidjane Thiam said following the results.

Prudential’s anticipated earnings of 79.2p per share for this year represents steady growth of 3% from 2012 levels, although this is expected to surge higher from next year — indeed, City number crunchers anticipate an 18% on-year improvement to 93.8p.

Recent share price advances has seen Prudential’s P/E rating for 2013 climb to 16.2, just above the prospective average of 15 for the complete life insurance sector. But striding expansion next year creates a much-improved readout of 13.6, as well as an astonishing price to earnings to growth (PEG) figure of 0.7 — any reading below 1 is considered exceptional bang for one’s buck.

In my opinion the company’s proven ability to keep earnings ticking higher, even in the toughest of economic climates, makes it an stellar stock pick for those seeking dependable year-on-year growth. And with weighty exposure to developing markets, I believe Prudential is ready to deliver blockbusting returns.

Cash in on other spectacular stocks

But regardless of whether or not you share my enthusiasm for insurance giant Prudential, there are a whole host of other FTSE 100 winners just waiting to bolster your investment returns. In this regard I strongly recommend that you check out these recommendations from veteran fund manager Neil Woodford which are primed with explosive growth potential.

Woodford -- in charge of UK Equities at Invesco Perpetual -- has more than 30 years' experience in the industry, and boasts an exceptional track record when it comes to selecting stock market stars.

This exclusive report, compiled by The Motley Fool's crack team of analysts, is totally free and comes with no further obligation. Click here now to download your copy.

> Royston does not own shares in Prudential.