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5 Growth Greats You Simply Can’t Ignore: GlaxoSmithKline plc, British American Tobacco plc, CRH PLC, Whitbread plc And Compass Group plc

Today I am looking at a cluster of blue-chip wonders offering up terrific growth potential.

GlaxoSmithKline

The enduring effect of patent losses across key drugs is expected to keep earnings on the back foot at GlaxoSmithKline (LSE: GSK) for a little while longer. Indeed, the business is expected to clock up its fourth consecutive annual bottom line decline in 2015 as a result, with the City chalking in an unhelpful 4% decline.

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Although any dip is hardly room for cheer, this year’s expected drop marks something of an improvement from recent years and illustrates the rewards of significant organic investment — not to mention solid acquisitions and industry collaborations over the years — on the company’s pipeline.

As a result GlaxoSmithKline is expected to flip back into the black this year with a 4% uptick, driving a P/E multiple of 18.2 times predicted earnings for this year to 17.2 times for 2016. I believe that GlaxoSmithKline’s market-leading proposition in key areas such as vaccines, combined with galloping healthcare from developing regions, makes the pharma play a steal at these levels.

British American Tobacco

In my opinion, British American Tobacco (LSE: BATS) remains a solid selection for growth hunters, despite the impact of regulatory constraints on tobacco usage and marketing and their effect on consumer spend. With disposable income levels in critical emerging markets — home to the lion’s share of the world’s smokers — heading higher, and the London firm ramping up its exposure to the lucrative e-cigarette market, I believe the business is an exceptional long-term growth selection.

Although the City expects British American Tobacco to record a modest 1% earnings improvement in 2015, the bottom line is expected to leap 8% in the following year as demand for its products takes off again.

Like GlaxoSmithKline, the tobacco giant trades on P/E multiples outside the benchmark of 15 times which indicates lip-smacking value, with readings of 17.8 times and 16.6 times for 2015 and 2016 respectively. But I believe the company’s suite of smoker favourites such as Lucky Strike, labels which carry formidable pricing power, merits this premium rating.

CRH

With the construction sector in the US on the march, and building activity in Europe gradually improving, I reckon that materials supplier CRH (LSE: CRH) is in prime position to enjoy resplendent earnings growth. And underpinned by shrewd asset juggling to make acquisitions in hot growth areas — indeed, the business sold off its Doras joint venture in France for €37m just yesterday — I believe the Dublin-based firm has both the financial clout and the know-how to keep the bottom line rising.

This view is shared by the number crunchers, who expect CRH to deliver splendid earnings expansion in the region of 47% in 2015, and a further 32% next year. Consequently the construction play’s P/E multiple collapses from 22.7 times for this year to 17.2 times in 2016, and I expect this to keep sliding as conditions in its end markets steadily improves.

Whitbread

Hotel and cafe operator Whitbread (LSE: WTB) has a terrific record of generating rip-roaring earnings growth, and has seen the bottom line expand at a compound annual growth rate of 14.5% during the past four years alone. And with revenues across its Costa Coffee and Premier Inn brands continuing to outperform — total sales surged 14.3% in the year concluding February 2015I believe the company is one of the hottest stocks on the market.

Indeed, Whitbread is anticipated to follow a 23% earnings advance for fiscal 2015 with additional rises to the tune of 15% and 14% in 2016 and 2017 respectively. Although P/E multiples of 22.9 times for this year and 20 times for 2017 may not at first glance appear the most appealing, in my opinion the firm’s aggressive expansion plans — Whitbread plans to lift capital expenditure to £700m in 2016 alone from £575m last year — should keep earnings rattling higher in the long term.

Compass Group

Like Whitbread, I believe Compass (LSE: CPG) is a great selection for those hunting for dependable earnings growth year after year. The catering specialists said last month that strong organic growth in Europe and the US, not to mention contract wins in emerging markets, is helping to power sales higher — indeed, organic revenue growth in new regions to register at 14% during October-March.

The abacus bashers expect Compass to record earnings growth to the tune of 13% for the 12 months ending September 2015, creating a chunky P/E ratio of 22.1 times. Predictions of a further 9% improvement in the following year drives this reading to 20.4 times, and although this remains elevated I believe that the firm’s exceptional performance across multiple global markets should help to keep the bottom line moving steadily higher.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended GlaxoSmithKline. 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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