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2 booming growth stocks I need in my Stocks and Shares ISA right now

As a committed value investor I’d happily sit on high-yielding FTSE 100 dividend shares for the rest of my earthly days. Just occasionally though, I spot a belting growth share that gets my juices flowing. In fact, I’ve got two up my sleeve that I think will really sing.

Watch closely

To make it onto my Stocks and Shares ISA watchlist, growth stocks have to tick a lot of boxes. This strict set of rules means I don’t make a fool of myself (not the good, Motley kind of Fool) by buying some awful rubbish that loses buckets and turns an outperforming portfolio into a horror show.

I need companies that lead their field, with manageable debt, high profits-to-market cap, that aren’t reliant on a single product, in a sector I understand, whose management makes the right moves, whose profits, earnings per share and sales are rising, and that still have room to grow.

Colour of money

The two FTSE 250 growth stocks I want for my Stocks and Shares ISA have a combined market cap of just £530m, light years away from the billion-pound boring-but-reliable dividend giants I normally favour.

Foreign exchange broker Argentex (LSE:ARGX) is a recent AIM float. It provides currency conversions for large corporate and institutional clients. It only joined the market in June, but digging back through the Argentex LLP financial statements filed with Companies House, I can see it has been profitable every year since it was founded in 2011. From 2017 to 2019 revenue grew from £10.6m to £21.9m, with operating profits more than doubling from £4.1m to £9.4m. The broker also added 243 corporate clients to its roster between 2018 and 2019 with £10.8bn in gross currency traded, up from £7.9bn the previous year.

Forex brokers require stringent regulatory compliance, including the EU directives PSD2 and MiFID2, and Argentex has invested wisely to make itself a leader in this field. Crossbench peer and former head of the CBI Lord Digby Jones is chairman, which gives me confidence the business is being run correctly. It has competition in the form of Travelex owner and another AIM newcomer Finablr, but Argentex is growing much more quickly.

Shares on a tear

Cloud computing provider Iomart (LSE:IOM) owns and operates 12 UK datacentres connected by its own dark fibre network, as well as operating a growing number of server farms in Europe, the US, Japan and Australia. I used to work in telecoms so I know a bit about this sector: if you switched off when the words ‘cloud computing’ appeared, then perhaps this stock isn’t for you. But I think Iomart has plenty of space to grow.

Pre-tax profits and earnings per share are rising and 10 years of consecutive dividend growth has always had more than 2.5 times earnings cover.

Management has refreshed the board recently and has invested in buying out the competition, including datacentre providers Bytemark and LDeX. This strategy, says Chairman Ian Steele, proves Iomart’s “ambition to deliver the same long-term pace of growth achieved over the last five years which saw the business double in size.”

Stocks and Shares ISA investors have had the opportunity to add AIM-listed growth stocks to their portfolio since the government relaxed the rules in 2013. I don’t tend to buy that many, but I’m watching these two very closely for the right time to strike.

A Growth Gem

Research into unloved sectors can often unearth fantastic growth opportunities to help boost your wealth – and one of Fool UK’s contributors believes they’ve identified one such winner, which could be a bona-fide bargain at recent levels!

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Tom holds no positions in the shares mentioned. The Motley Fool UK owns shares of Iomart 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.