One of the most popular long-term investment strategies in the stock market is investing in growth companies., whose results are above the market average.
Растущая компания — это бизнес, which demonstrates improvement in key indicators over a long period of time.
To find such an issuer, not enough to look at the financial statements: an increase in revenue and profit over several years may be the result of favorable market conditions (rising prices for basic products or services, currency depreciation).
The opposite effect may also occur., when unfavorable price conditions in the market make it difficult to find a company in a timely manner, whose business is rapidly growing in size, occupying an increasing share of its market, capturing free space or crowding out competitors.
Investor, who wants to find a growth story, should look into the operating reports of the issuer.
The article presents five Russian public companies, whose key operating indicators have shown growth over the past five years - from 2016 on 2020 G. Wherein 2020 the year spoiled the statistics for many oil and gas companies, petrochemical, energy, Transport, Engineering, metallurgical and other sectors of the economy, due to the decline in business activity due to the COVID-19 pandemic and the introduction of restrictive measures.
PAO "FosAgro"
PhosAgro is one of the five world leaders in the production of phosphorus-containing fertilizers and is the largest participant in the European market. IN 2020 G. against the backdrop of growing demand from the agricultural sector, the company sold record volumes of fertilizers and received the highest revenue in its history. This became possible thanks to the effective work of management and a large-scale investment program., which made it possible to annually increase production volumes and vertical integration of the business. IN 2020 G. was produced 10 million tons of fertilizers.
Rice. 1. A source: operating data of PhosAgro PJSC Rice. 1. A source: operational data of PhosAgro PJSC
Rice. 2. A source: operating data of PhosAgro PJSC Rice. 2. A source: operational data of PhosAgro PJSC
PJSC "Detsky Mir"
The largest Russian retail chain, selling baby goods, increased the number of retail stores and net turnover even in the context of the COVID-19 pandemic and severe restrictive measures, introduced in the first half 2020 G.
In the end 2020 G. the company controlled 868 stores in Russia and the countries of the former USSR, out of which 832 fell on the retail network "Children's World". Consolidated Revenue Reaches Record. Online sales played an important role, which have increased in 2,2 Times.
Rice. 3. A source: operational data of PJSC "Detsky Mir" Rice. 3. A source: operational data of PJSC "Detsky Mir"
Rice. 4. A source: operational data of PJSC "Detsky Mir" Rice. 4. A source: operational data of PJSC "Detsky Mir"
Rice. 5. A source: operational data of PJSC "Detsky Mir" Rice. 5. A source: operational data of PJSC "Detsky Mir"
PAO "M.Video"
IN 2019 G. M.Video-Eldorado Group completed the merger of two large retail chains, selling household and electronic appliances. "M.Video» was the leader, Eldorado is the third participant in the domestic market. After buying a competitor, the group's management decided to keep both brands., but on a single legal and technological basis.
The company showed an increase in operating performance in 2020 G., when the work of retail non-food chains was limited due to the unfavorable epidemiological situation. The company switched to a hybrid model in a timely manner, integrating online and offline business segments on a single platform, which made it possible to maintain sales even in times of crisis and external restrictions.
Rice. 6. A source: operating data of PJSC "M.Video" Fig.. 6. A source: operational data of PJSC "M.Video"
Rice. 7. A source: operating data of PJSC "M.Video" Fig.. 7. A source: operational data of PJSC "M.Video"
Rice. 8. A source: operating data of PJSC "M.Video" Fig.. 8. A source: operational data of PJSC "M.Video"
PAO "Cherkizovo"
The largest meat producer in Russia showed an increase in production and sales in 2020 G., despite the crisis and the temporary closure of catering establishments, who are major consumers of meat products. This was facilitated by active investment activities., as well as entering the export markets of China and the Middle East.
Rice. 9. A source: operating data of PJSC "Cherkizovo" Rice. 9. A source: operational data of PJSC "Cherkizovo"
Rice. 10. A source: operating data of PJSC "Cherkizovo" Rice. 10. A source: operational data of PJSC "Cherkizovo"
PAO Beluga Group
PJSC Beluga Group is the largest producer of strong alcohol in Russia. The company demonstrates the growth of production indicators for five years. The crisis did not stop (and even helped) companies to improve their operating results.
Beluga Group produces alcoholic beverages and distributes well-known foreign brands, develops its own specialized retail network "VinLab", which numbered 640 stores in 2020 G.
Rice. 11. A source: operating data of PJSC "Beluga Group" Rice. 11. A source: operational data of PJSC "Beluga Group"
Rice. 13. A source: financial data of PJSC "Beluga Group" Rice. 13. A source: financial data of PJSC "Beluga Group"
Exceptions to the rules
An increase in production results does not always lead to an increase in financial indicators and market quotations of the issuer's shares. If the business does not control costs, then an increase in production and sales can reduce, and not increase the company's profits. The opposite situation also happens.: production figures are decreasing every year. Thanks to the successful work of management to optimize business processes and exits from low-profit assets, profit, due to shareholders, Grows.
For example, energy holding PJSC "OGK-2", which has been reducing the volume of useful electricity supply for five years, but his net income is growing at the same time.
Rice. 14. A source: operating data of PJSC "OGK-2" Rice. 14. A source: operational data of PJSC "OGK-2"
Rice. 15. A source: financial data of PJSC "OGK-2" Rice. 15. A source: financial data of PJSC "OGK-2"
