One of the great things about investing is turning your hard-earned cash into an even greater amount. Certainly, the journey between those two places is not always a smooth one and, in the intervening period, the value of your investments can rise and fall significantly. However, for long term investors, what matters is that the total return is relatively high.
Clearly, such a prospect is likely to get any investor’s pulse racing, with stocks that offer the potential for high levels of growth and capital gains being among the most sought after. And, on that front, there are a number of great options for investors to choose from at the present time.
For example, online fashion retailer, Boohoo.Com (LSE: BOO), is set to benefit from an improving UK and global economy as it seeks to develop customer loyalty. Of course, this takes time to acquire and, with there being such vast competition among retailers that are focused on the lucrative teen and twentysomething marketplace, Boohoo.Com is set to be a relatively volatile stock to own.
However, looking ahead to its earnings growth potential, it could prove to be a hugely exciting investment. That’s because it is forecast to increase its bottom line by 43% in the current year, followed by growth of 25% next year. If met, that would be a stunning rate of growth and would easily surpass the vast majority of Boohoo.Com’s listed peers. In fact, it would mean that the company’s bottom line would rise by 79% over the next two years and, despite this, it trades on a price to earnings growth (PEG) ratio of just 0.8. This indicates that it has a sufficiently wide margin of safety to post significant share price gains moving forward.
Likewise, pharmaceutical company, Clinigen (LSE: CLIN), also has an exciting medium term outlook. Although its earnings are set to rise by just 1% this year, its bottom line is expected to soar by as much as 29% next year, which could act as a positive catalyst for its share price. Certainly, much of this growth has already been priced in, with Clinigen’s share price having risen by 23% since the turn of the year. However, with its shares having a price to earnings (P/E) ratio of 26.1, its PEG ratio of 0.7 offers significant upside.
Of course, there are a number of turnaround stocks that also offer future growth prospects and excitement for their investors. One such stock is online advertising specialist, Blinkx (LSE: BLNX). It is in the midst of a major restructuring, rebranding and acquisition spree as its management team goes all out to try and reverse the disappointing performance that has turned a healthy and rising black bottom line into a red one.
Looking ahead, Blinkx is set to post a pretax loss in the current year as well as next year. However, the scale of the loss is due to fall from £16.5m last year to just £0.65m next year. And, with a sound strategy and improving outlook, investor sentiment could pick up and push Blinkx’s share price significantly higher.