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Alberto Abaterusso
Alberto Abaterusso
Articles (1905) 

These Stocks' Sales Have Grown Fast

Lithia Motors Inc tops the list

February 13, 2020 | About:

Increasing sales are an essential catalyst to the share prices of U.S. listed stocks. The approximately 4% growth in the S&P 500’s total annual sales over the past five years resulted in a 60.2% increase in its price to close at $3,379.45 on Feb. 12.

The following trio of companies has topped the benchmark for the U.S. market in terms of higher sales growth over the past five years, posting large returns in the 40% to 220% range as a result.

Even though the past is no guarantee for future performance, these companies hold potential to further increase their total sales in the years to come, as they have already raised their top lines remarkably for the past five years.

Furthermore, Wall Street analysts have released optimistic recommendation ratings for these companies.

Lithia Motors

The first company that meets the above-listed search criteria is Lithia Motors Inc (NYSE:LAD).

The Medford, Oregon-based automotive retailer has grown its trailing 12-month revenue by 23.5% over the past five years, producing a 44.5% increase in the share price.

The share price traded at $128.75 at close on Feb. 12 for a market capitalization of $2.99 billion.

The stock has a price-earnings ratio of 11.42 and a price-sales ratio of 0.24. According to the Peter Lynch chart, this stock is trading below its fair value.

Wall Street sell-side analysts recommend an overweight rating for this stock with an average target price of $158.22.

GuruFocus assigned the company a moderate financial strength rating of 4 out of 10 and a very positive profitability rating of 7 out of 10.

Mastech Digital

The second company that has the above-listed criteria is Mastech Digital Inc (MHH).

The Pittsburgh, Pennsylvania-based provider of digital transformation IT services has grown its trailing 12-month revenue by 11.7% in the past five years, determining a 217.81% rise in the share price.

The stock was trading around a price of $16.03 per share at close on Feb. 12 for a market capitalization of $176.86 million, a price-earnings ratio of 15.68 and a price-sales ratio of 0.93. The Peter Lynch chart suggests that the stock is currently not too expensive.

Wall Street sell-side analysts recommend a buy rating for this stock with an average target price of $15.

GuruFocus assigned the company a positive financial strength rating of 6 out of 10 and a very high profitability rating of 9 out of 10.

Controladora Vuela Compania de Aviacion

The third company that meets the above-listed criteria is Controladora Vuela Compania de Aviacion SAB de CV (NYSE:VLRS).

The Mexican provider of air transportation services for passengers, cargo and mail in Mexico and internationally has raised its trailing 12-month revenue by 7.3% in the past five years, determining a 43.12% increase in the share price.

The share price closed at $13.23 on Feb. 12 for a market capitalization of $1.31 billion. The stock has a price-earnings ratio of 13 and a price-sales ratio of 0.74. The Peter Lynch chart shows that the stock currently trades cheaply.

Wall Street sell-side analysts have recommended a buy rating for this stock and established an average target price of 265.91 Mexican Pesos (approximately $14.27) per share.

Disclosure: I have no positions in any securities mentioned in this article.

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About the author:

Alberto Abaterusso
If somebody asks what being a value investor means, Alberto Abaterusso would answer, “The value investor is not just the possessor of the security that represents the company, but he is the owner of that company. As an owner of the company the value investor is actively involved in the dynamics of that company and his first concern is how to have sales progressively growing. Also, the value investor is probably one of the most demanding persons in the world concerning sales.”

Abaterusso is a freelance writer based in The Netherlands. He primarily writes about gold, silver and precious metals mining stocks. His articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. Alberto holds an MBA from Università degli Studi di Bari (Italy), Aldo Moro.

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