3 Growth Stocks I’d Buy With £10,000: Barclays PLC, ARM Holdings plc And easyJet plc

Barclays PLC (LON: BARC), ARM Holdings plc (LON: ARM) and easyJet plc (LON: EZJ) look attractive right now.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

While it’s always great to buy shares that offer top-notch value for money and that pay great yields, growth stocks can still play a key role in investors’ portfolios. That’s because, while often riskier, they can make the biggest positive contribution to retirement planning, mortgage repaying and increased wealth of any type of company — especially when they are bought at reasonable valuations.

With that in mind, here are three companies with growth potential that look good value right now.

BarclaysBarclays

Despite there being a seemingly continuous flow of bad news, Barclays (LSE: BARC) (NYSE: BCS.US) has huge growth potential. Indeed, while the media focuses on the latest allegations at the bank surrounding dark pools, growth investors are looking further ahead. That’s because Barclays is forecast to post earnings per share (EPS) growth of 32% in the current year and 26% next year. That means that in 2015 its profits could be two-thirds higher than they were in 2013, which would be a very impressive growth rate. With shares in Barclays trading on a price to earnings (P/E) ratio of just 10, they appear to offer growth at a very reasonable price.

ARM HoldingsARM

ARM (LSE: ARM) (NASDAQ: ARMH.US) continues to be the UK’s pre-eminent technology company. Indeed, a glance at its expected growth rate in EPS soon tells us why. ARM is forecast to deliver bottom line growth of 11% in the current year and 23% next year. Certainly, ARM shares trade on a high P/E multiple of 36, but when this is combined with the company’s forecast growth rate it yields a price to earnings growth (PEG) ratio of 1.6, which is historically fairly low for ARM. Furthermore, the company offers greater stability than many of its technology peers, for which a premium seems deserved.

easyjeteasyJet

With shares in easyJet (LSE: EZJ) having pulled back in recent weeks, they now offer great value as well as strong growth prospects. Indeed, EasyJet trades on a P/E of just 11.7, which is considerably lower than the FTSE 100’s P/E of 14. Furthermore, EasyJet is set to post double the wider index’s growth over the next two years, as its bottom line is due to rise by 12% this year and by 12% next year. This puts EasyJet on a PEG of less than one, which is very attractive and shows that the stock could deliver strong gains in future.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Peter Stephens owns shares of Barclays. The Motley Fool has recommended shares in ARM Holdings.

More on Investing Articles

Affectionate Asian senior mother and daughter using smartphone together at home, smiling joyfully
Investing Articles

How I’d invest my first £20k ISA to target £4,900 a year from dividend shares

Looking for dividend shares in a new Stocks and Shares ISA, and want diversification too? Here's how I'd go about…

Read more »

Passive income text with pin graph chart on business table
Investing Articles

Yields of up to 7%! I’d consider boosting my income with these FTSE dividend stocks

The London market has some decent-looking dividend stocks right now, and I’m tempted by these two for growing income streams.

Read more »

Young mixed-race couple sat on the beach looking out over the sea
Investing Articles

I’d put £20K in an ISA now to target a £1,900 monthly second income in future!

Christopher Ruane shares why he thinks a long-term approach to investing and careful selection of shares could help him build…

Read more »

Mature couple at the beach
Investing Articles

6 stocks that Fools have been buying!

Our Foolish freelancers are putting their money where their mouths are and buying these stocks in recent weeks.

Read more »

Black woman using loudspeaker to be heard
Investing Articles

I was right about the Barclays share price! Here’s what I think happens next

Jon Smith explains why he still feels the Barclays share price is undervalued and flags up why updates on its…

Read more »

Investing Articles

Where I’d start investing £8,000 in April 2024

Writer Ben McPoland highlights two areas of the stock market that he would target if he were to start investing…

Read more »

View of Tower Bridge in Autumn
Investing Articles

Ahead of the ISA deadline, here are 3 FTSE 100 stocks I’d consider

Jon Smith notes down some FTSE 100 stocks in sectors ranging from property to retail that he thinks could offer…

Read more »

Young female business analyst looking at a graph chart while working from home
Investing Articles

Why I think Rolls-Royce shares will pay a dividend in 2024

Stephen Wright thinks Rolls-Royce shares are about to pay a dividend again. But he isn’t convinced this is something investors…

Read more »