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2 FTSE 100 growth stocks I’d buy and hold for 25 years

Halma (LSE: HLMA) has already proven its mettle as a go-to growth stock, the business churning out solid profits expansion for years now and, more recently, its bottom line growing by double-digit percentages.

The City is expecting the business, which provides hazard detection and life protection products, to report an 8% advance for the year to March 2018 when it releases trading details on June 12. And further chunky jumps, of 10% and 6%, are slated for fiscal 2019 and 2020 respectively.

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Now Halma may be expensive, the FTSE 100 firm currently carrying a forward P/E ratio of 27.5 times. But in my opinion its brilliant long-term profits outlook merits such a premium.

On the charge

You see, in its latest trading update Halma underlined its exceptional defensive characteristics that keep on driving the bottom line whatever the weather. Back in March it advised that “order intake has remained ahead of revenue” during the last fiscal year, the company benefitting from “the diversity of its markets and resilient growth drivers.”

Halma has its fingers in many pies, allowing it to keep growing sales even if one of two of its end sectors encounter some turbulence. Its excellent geographical wingspan is another reason that it remains so resilient. As well as lauding the “good progress” it has made in the UK, US and continental Europe in the last fiscal period, it also reported “strong performance” in the hot growth regions of Asia Pacific.

As my Foolish colleague Roland Head pointed out late last year, Halma has worked hard to improve its market position across the world through its busy M&A drive. Over the past decade it has spent close to £750m on more than 30 businesses and its formidable cash generation means that such earnings-boosting measures is likely to continue with gusto.

Adjusted operating cash flow jumped 13% year-on-year during April-September to £83.7bn, and the company advised in March that its strong balance sheet means that “we continue to identify potential acquisition opportunities in all four of our sectors.”

Revenues about to rebound?

Halma is clearly a great selection for growth seekers scouring the Footsie index. But it isn’t the only one, and The Sage Group (LSE: SGE) is another blue-chip worthy of serious attention.

Sage, like the safety equipment specialist, has churned out reliable profits expansion for many years now. And the Square Mile’s army of boffins are predicting additional rises of 9% in both the years to September 2018 and 2019.

It may also be expensive on paper, the financial software giant sporting a forward P/E multiple of 20.4 times. But its exciting growth measures still make it an attractive buy, in my opinion.

Recurring revenues growth has disappointed more recently and caused the company to downgrade its full-year sales expectations back in April. Sales rose 6.4% in the first half versus 11.1% a year earlier, Sage advised in May’s subsequent trading statement.

However, the tech giant also advised this month that “the root causes of execution issues have been identified and management has already made changes,” and that it expects sales to accelerate from the second half and beyond. There was always going to be some trouble emanating from its switch to its subscription-based model, and I remain convinced that this move should still deliver excellent profits growth in the years ahead.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Halma and Sage Group. 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.