3 Stocks Primed To Deliver Stunning Growth Beyond 2015: ARM Holdings plc, easyJet plc And Prudential plc

Royston Wild explains why ARM Holdings plc (LON: ARM), easyJet plc (LON: EZJ) and Prudential plc (LON: PRU) are primed to deliver robust earnings expansion well beyond this year.

| 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.

Today I am looking at three FTSE 100 beauties expected to deliver stunning earnings growth in 2015 and beyond.

ARM Holdings

City brokers expect chipbuilder ARM Holdings (LSE: ARM) (NASDAQ: ARMH.US) to keep on churning out explosive earnings growth on the back of its portfolio of market-leading technology, a quality which has sealed its top-tier status to the world’s biggest gadget manufacturers like Apple. Current forecasts point to a 22% expansion in the bottom line this year, and an extra 20% advance is estimated for 2016.

At face value ARM Holdings may not be considered the most attractive stock available owing to stratospheric P/E multiples of 33.7 times and 27.8 times for 2015 and 2016 respectively, figures which also leave it prone to huge share price swings should earnings projections come under pressure.

But with revenues from in the critical smartphone market having improved following Apple’s exceptional iPhone launch during the autumn, and ARM Holdings expanding aggressively in the next-gen growth sectors of networking and servers, I believe that the firm is in exceptional shape to make good on analyst assumptions.

easyJet

Budget airliner easyJet (LSE: EZJ) continues to benefit from bubbly demand from holidaymakers and business customers alike for cheap air travel. As has been seen in the UK grocery sector, consumers are now demanding more bang for their buck in the post-recession landscape, exacerbated by lasting economic pressure on travellers’ wallets.

Indeed, the carrier announced last week that passenger numbers leapt 6.5% during 2014 to 65.3 million, and easyJet’s ongoing route and airport-adding programme promises to keep earnings growth soaring in future years. Meanwhile a nosediving oil price should also looks likely to boost the bottom line in coming years.

The number crunchers expect easyJet to see earnings soar 11% in the 12 months ending September 2015, and a further 13% improvement is pencilled in for fiscal 2016. As a result the business changes hands on highly-attractive P/E multiples of 12.6 times and 11.3 times for 2015 and 2016 correspondingly.

Prudential

Global insurance giant Prudential (LSE: PRU) (NYSE: PUK.US) looks set to benefit from its sprawling exposure to emerging markets, particularly those of Asia where product penetration remains relatively low yet rising disposable income levels continue to climb. Indeed, the business saw new business profit from the region jump 15% during January-September, to £775m.

Like easyJet, Prudential has a terrific record of generating year-on-year earnings growth, a trend which analysts see no signs of abating — the company is anticipated to see growth surge 14% in 2015, and a further 12% in 2016.

Consequently Prudential changes hands on a P/E of just 13.6 times for this year and 12.1 times for 2016. And the company’s excellent value for money is really underlined by a price to earnings to growth (PEG) multiple of just 1 through to the end of next year, bang on the watermark which indicates stupendous bang for one’s buck.

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.

Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended ARM Holdings. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Bus waiting in front of the London Stock Exchange on a sunny day.
Investing Articles

If interest rate cuts are coming, I think these UK growth stocks could soar!

Falling interest could be great news for UK growth stocks, especially those that have been under the cosh recently. Paul…

Read more »

Investing Articles

Are these the best stocks to buy on the FTSE right now?

With the UK stock market on the way to hitting new highs, this Fool is considering which are the best…

Read more »

Petrochemical engineer working at night with digital tablet inside oil and gas refinery plant
Investing Articles

Can the Centrica dividend keep on growing?

Christopher Ruane considers some positive factors that might see continued growth in the Centrica dividend -- as well as some…

Read more »

Smiling family of four enjoying breakfast at sunrise while camping
Investing Articles

How I’d turn my £12,000 of savings into passive income of £1,275 a month

This Fool is considering a strategy that he believes can help him achieve a stable passive income stream with a…

Read more »

Person holding magnifying glass over important document, reading the small print
Investing Articles

2 top FTSE 250 investment trusts trading at attractive discounts!

This pair of discounted FTSE 250 trusts appear to be on sale right now. Here's why I'd scoop up their…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

3 things that could push the Lloyds share price to 60p and beyond

The Lloyds share price has broken through 50p. Next step 60p? And then what? Here are some thoughts on what…

Read more »

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

£1,000 in Rolls-Royce shares a year ago would be worth this much now

Rolls-Royce shares have posted one of the best stock market gains of the past 12 months. But what might the…

Read more »

Investing Articles

Are HSBC shares a FTSE bargain? Here’s what the charts say!

There are plenty of dirt-cheap FTSE 100 banking stocks for investors to choose from today. Our writer Royston Wild believes…

Read more »