5 Growth Stocks For 2015: Imperial Tobacco Group PLC, Dixons Carphone PLC, London Stock Exchange Group Plc, Wolseley plc And Barratt Developments Plc

Imperial Tobacco Group PLC (LON:IMT), Dixons Carphone PLC (LON:DC), London Stock Exchange Group Plc (LON:LSE), Wolseley plc (LON:WOS) and Barratt Developments Plc (LON:BDEV) all offer growth at a reasonable price for 2015.

| 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.

As we move into 2015, the global economic recovery is gaining traction and companies with the best growth prospects are attracting the most attention.  With this in mind, and if you’re stuck for ideas, here are five companies with some of the best growth prospects for 2015.

Leading provider

The London Stock Exchange (LSE: LSE) is busy building its presence in the global finance industry and is rapidly becoming one of the world’s leading financial services companies. This expansion is driving rapid growth at one of the world’s leading exchange providers.

Current figures suggest that the company will grow earnings by 26% next year, which puts the shares on a PEG ratio of 0.9 at present levels — indicating growth at a reasonable price. The group’s shares currently trade at a forward P/E of 18.1.

Property boom 

Barratt Developments (LSE: BDEV) has staged an impressive recovery over the past five years and the group’s growth is set to continue next year. Thanks to the booming UK property market, City analysts believe that Barratt’s earnings per share will expand 38% during 2015.

As the company is currently trading at a forward P/E of 10.7, earnings growth of 38% puts the stock on a PEG ratio of 0.3. A lowly growth valuation that’s almost too hard to pass up. 

International growth 

After spending much of the past two years restructuring, City analysts expect Imperial Tobacco’s (LSE: IMT) growth to explode next year. On average, analysts are predicting earnings per share growth of 19% next year, although this forecast could be revised higher, if Imperial’s deal to acquire a number of US cigarette brands goes ahead.

The company currently trades at a forward P/E of 13.5 and projected earnings growth of 19% next year gives a PEG ratio of 0.9, once again indicating growth at a reasonable price. Not only is Imperial cheap compared to its projected growth, the company currently supports a dividend yield of 4.5%. 

Merger synergies 

The recently merged Dixons Carphone (LSE: DC) is set to grow next year as the synergies gained from the deal between Dixons and Carphone Warehouse start to filter through.

According to current figures, the new, larger company will report earnings per share of 22.02p for 2015, a full 33.2% higher than the figure reported last year for the two separate entities. Dixons Carphone is currently trading at a forward P/E of around 18, which means that the shares trade at a PEG ratio of 0.7. What’s more, City analysts believe that Dixons Carphone’s earnings will expand a further 22% during 2016. 

So, if you’re looking for a great growth stock for the next few years, Dixons Carphone could be the way to go. 

Rising demand 

And lastly, Wolseley (LSE: WOS), which is my final GARP pick for 2015. 

Even though Wolseley looks expensive at present levels — the shares are currently trading at a forward P/E of 15.7 — City analysts expect the group’s earnings per share to expand by 23% next year. With earnings growth of 23% expected, the high earnings multiple is justified and a low PEG ratio of 0.8 only confirms the fact that the group is attractively priced at present levels.

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.

Rupert Hargreaves owns shares of Imperial Tobacco Group. The Motley Fool UK has no position in any of the shares mentioned. 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

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 »

Three signposts pointing in different directions, with 'Buy' 'Sell' and 'Hold' on
Investing Articles

Just released: Share Advisor’s latest ‘Hold’ recommendation [PREMIUM PICKS]

In our Share Advisor newsletter service, we provide buy, sell, and hold guidance for our universe of recommendations.

Read more »