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4 Growth Giants For Your Stocks Portfolio: Diageo plc, Babcock International Group PLC, Regus PLC And Domino’s Pizza Group PLC

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Today I am looking at four London lovelies primed to deliver stonking earnings expansion.

Diageo

With cyclical headwinds in critical emerging regions having forced earnings lower at Diageo (LSE: DGE) last year, and a further bottom line anticipated for the current year — a 6% dip is currently anticipated by the City — picking the drinks giant as a growth superstar would appear a tad barmy at first glance. But with consumer spending in these places showing signs of improvement, and the London firm expanding aggressively in such lucrative markets, I reckon the bottom line should explode higher in the coming years.

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Indeed, the number crunchers expect this renaissance to kick off imminently, and have pencilled in an 8% rise for the year concluding June 2016. While it is true that Diageo can hardly be considered cheap, with a P/E multiple of 18.1 times for the coming year peeking above the benchmark of 15 times that indicates decent value, I reckon the firm’s tremendous global footprint, combined with its extensive suite of market-leading products — from Guinness stout through to Johnnie Walker whiskey — to blast revenues skywards once more.

Babcock International Group

I am a big fan of engineer Babcock International (LSE: BAB) owing to its expertise across a variety of industries. While the prospect of depressed spending across the oil sector is likely to remain an issue for some time to come, the company continues to witness surging demand from elsewhere and revenues climbed 27% in the year ending March 2015, to £4.5bn. In particular Babcock reported “compelling” growth at its Marine and Technology and Support Services arms.

And with the order book standing at a record £20bn as of March, the City expects the business to register earnings growth of 12% and 11% in the periods concluding 2016 and 2017 respectively. And such readings make Babcock brilliant value for money, in my opinion, with the company carrying earnings ratios of 14.9 times for this year and 13.4 times for 2017.

Regus

With the UK economic recovery continuing to ratchet through the gears, I expect demand at office provider Regus (LSE: RGU) to keep ticking higher. But it is not just in Britain where the firm plies its trade, and just today announced it would be expanding into Iraq — representing the 105th country the workspace provider now operates in — and the company is planning to open up shop in Brunei in the near future, too.

Indeed, the Luxembourg-based firm is committed to a course of rapid expansion and opened another 81 locations in January-March, taking the total number of sites to 2,342. With revenues poised to charge higher Regus anticipated to punch earnings growth of 44% in 2015 and 34% next year, driving the P/E multiple from 22.8 times for this year to 17.2 times in 2016. And the firm’s brilliant value is illustrated by a PEG number below the threshold of 1 through to the close of next year, at just 0.5.

Domino’s Pizza Group

With Britain’s takeaway obsession showing no signs of letting up, I expect fast food emporium Domino’s Pizza (LSE: DOM) to continue enjoying delicious sales growth. The company’s continued store rollout helped it cook up an astonishing 75 million pizzas last year, while a renewed focus on e-commerce is also helping to boost orders from hungry customers.

Domino’s has a long, proud history of generating double-digit earnings growth, and this trend is not expected to end any time soon — indeed, the City expects the pizzamaker to enjoy expansion in the region of 15% and 13% in 2015 and 2016 correspondingly. These numbers push a P/E multiple of 26 times for this year to 22.8 times for 2016, and although this may appear expensive based on conventional metrics, I believe Domino’s dominant position in an expanding market fully merits this premium.

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

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