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CRH plc isn’t the only FTSE 100 growth share I’d buy today

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The long-running international expansion plan over at CRH (LSE: CRH) convinces me that it should remain an impressive growth generator for many years to come.

CRH — a multinational giant in the provision of building materials — has seen earnings swell at a compound annual growth rate of 27.7% during the past five years, and Thursday’s bubbly trading statement convinces me that earnings can continue pounding higher.

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The FTSE 100 firm sprang 3% today after announcing that revenues rose 2% in 2017 to €27.6bn, with like-for-like sales rising by the same percentage. As a result, pre-tax profit at CRH boomed 16% year-on-year to €2.01bn.

Celebrating the result, chief executive Albert Manifold commented: “2017 was a year of continued profit growth for CRH. We benefitted from increases in underlying demand in the Americas and positive momentum in Europe, and with focus on performance improvement and operational delivery, margins and returns were ahead of last year in our American and European Divisions.”

He added that the ongoing economic recovery should underpin further progress in 2018.

M&A mammoth

Now City analysts are expecting earnings expansion to cool in the more immediate future, a 5% rise forecast for 2018. However, this is expected to prove a temporary slowdown as a return to double-digit growth is predicted in 2019, by 13%.

CRH has tremendous scale which puts it in the box seat to exploit improving market conditions across many global markets. The company’s enthusiastic M&A drive is expanding its footprint in key geographies and sectors. It made 31 acquisitions and three investments last year for a combined €1.9bn, up from the 24 acquisitions and investments made in 2016.

And CRH still has the monster €3.5bn takeover of US cement mammoth Ash Grove to come later this year, of course, while it is still eyeing up acquisitions elsewhere to keep profits moving skywards.

A forward P/E ratio of 14.3 times does not reflect CRH’s bright earnings outlook, in my opinion. It’s a Footsie bargain worthy of serious attention.

Medical marvel

Smith & Nephew (LSE: SN) is another Footsie share I am tipping to deliver strong and sustained profits expansion.

The Square Mile is touting a 4% earnings improvement in 2018, and an extra 7% rise is predicted for 2019.

Now current projections make the artificial limb and joint builder a tad toppy on paper, Smith & Nephew carrying a forward P/E multiple of 18.2 times. This is a small price to pay for the company’s rising might in lucrative developing markets however.

Group revenues rose 5% in 2017 to £1.28bn, the firm advised this month, driven by a 12% sales improvement from its emerging economies. This was thanks in large part to improving conditions in the Asian engine room of China, where sales rose by double-digit percentages last year.

Smith & Nephew commented in the results report: “We are well positioned to continue to drive strong growth from the emerging markets over the medium term.” And this is hardly a surprise as rising population levels and improving economic might underpin increases in healthcare budgets, and the FTSE 100 stock’s conveyor belt of cutting-edge technologies continues to win plaudits.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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