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Kerry Group plc isn’t the only growth stock I’d consider buying for my ISA

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The prospects for the global economy seem to be relatively upbeat. Certainly, there are potential inflationary pressures which could come to the fore over the medium term. But with policymakers ready to raise interest rates in the UK and in other parts of the globe, this could lead to a continuation of the favourable trading conditions of recent years.

Therefore, the future prospects for companies such as food producer Kerry Group (LSE: KYGA) seem to be positive. However, it’s not the only growth stock that could be worth buying today.

Improving performance

Reporting on Thursday was online trading specialist IG Group (LSE: IGG). The company’s performance in the third quarter of the year was stunning, delivering a record level of revenue. Net trading revenue of £152.9m was 30% up on the same quarter of last year, which shows that the company’s customer acquisition strategy seems to be working well. In fact, there were 12,500 new clients who traded for the first time during the period, while the number of active clients was up 4% on the prior year.

Looking ahead, IG Group is expected to record a rise in its bottom line of 20% in the current year. Despite this, it has a price-to-earnings growth (PEG) ratio of just 0.7, which suggests that it could offer good value for money.

Certainly, there are regulatory risks ahead which could hurt the company’s performance in future years. But with such a low valuation, it appears as though investors have factored in potential difficulties over the medium term. Therefore, the stock remains a sound risk/reward opportunity for the long run, although its stock price may be volatile in the near term.

Reliable performance

While the prospects for the global economy may be bright, investor sentiment has weakened in recent months. Therefore, it may be prudent to buy stocks that offer a strong track record of growth which may be replicated in future years.

On this front, Kerry Group seems to offer significant appeal. It’s been able to deliver positive earnings growth in each of the last five years, with its bottom line rising at an annualised rate of 8%. This shows it has a relatively resilient business model which could provide it with a premium valuation in the long run.

With Kerry Group expected to post earnings growth of 10% in the next financial year, its share price could gain a boost from improving investor sentiment. Although it already trades on a price-to- earnings (P/E) ratio of 22.8, it does not appear to be overpriced compared to many of its global industry peers. Therefore, for investors seeking a mix of solid growth prospects and a resilient outlook, the company could prove to be a sound investment for the long term in a variety of market conditions.

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Peter Stephens 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.