11 High Growth Low Debt Stocks to Consider for Investment Opportunities
We will discuss 11 high growth low debt stocks that present promising opportunities for investment. These stocks have been carefully selected based on their competitive advantages, estimated EPS growth rates, and low debt to equity ratios. Our methodology for choosing these stocks involved filtering through a myriad of metrics and selecting companies with strong fundamentals and potential for long-term growth.
The United States stock market continues to rally with optimism related to interest rates. On November 28, Fed Governor Christopher Waller expressed confidence in the current monetary policy to bring inflation down to 2%. This has led to consecutive weeks of positive performance for major stock indices, with the S&P 500 expected to have one of its best months since July 2022.
For the purpose of this article, we have chosen EPS growth as the main factor to identify high growth stocks, from a myriad of possible metrics such as revenue growth and EBITDA growth. We have defined high growth companies as those with an estimated average annual EPS growth rate of at least 15% over the next 5 years. Additionally, we have selected companies with debt to equity ratios lower than 0.50, indicating a low level of financial obligations and a greater ability to raise debt, if required, in the future.
Moreover, we have considered the competitive advantage of the stocks we have chosen. Competitive advantages require time to be developed and honed, and require excellence in various aspects of a company’s operations. Our selection includes companies with wide moat ratings, indicating a sustainable competitive advantage for at least the next 20 years, and narrow moat ratings, indicating a sustainable competitive advantage for at least 10 years. These ratings are based on the Morningstar Wide Moat Focus Index, which focuses on companies with wide moat ratings trading at the lowest current market price.
