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Finding the right growth stock these days has been difficult for Motley Fool investors. One will start climbing higher and higher, but will lead to a huge drop which investors will then take to heart and sell out of fear. This continues to create a volatile situation in the market, with investors not knowing where to turn.
But here I’m going to discuss two stocks, a growth stock that you should consider as a long-term investment, and another that you might want to sell for now, and hold a stake once again.
A growth stock to buy
Not all tech stocks are bad, and there is one growth stock that I would consider a win for any portfolio. This is Constellation Software (TSX:CSU), a software company that has built a solid reputation as the king of acquisition. Plus, he’s been around the block for a while. So while its tech peers continue to try to catch up to its profitable performance, investors in Motley Fool can look forward to years of strong growth.
And that growth has indeed been strong. Over the past decade, Constellation shares have risen 2,236%! This is a compound annual growth rate of around 37% at the time of writing, which is virtually unheard of in the tech industry. And that’s because it has what other tech stocks don’t: a proven track record of outstanding performance.
The company continues to build its portfolio of acquisitions, continues to generate revenue and even continues to pay a dividend. Again, no other growth stock in the technology sector offers this. So I would definitely buy this growth stock as a long term holding for your portfolio.
One to give up…for now
The other growth stock that has done incredibly well could fall very soon. Nutrien (TSX:NTR)(NYSE:NTR) is a top growth stock thanks to owning market share in the fertilizer industry. And the ongoing crisis in Ukraine has led to sanctions against Russia, which supplies nutrients to crops that Nutrien stock has taken over.
This, however, is not a long term solution. Russia has always touted cheaper prices for crop nutrients, oil and gas, etc. It is therefore likely that revenues will be diverted once the crisis is over. This could lead to a stock price crash as Nutrien continues to break above all-time highs.
But do not get me wrong. Nutrien is still a growth stock that I would consider buying on a downside. Unfortunately, it’s still too new for a company to provide much of its background. Right now, it’s situational growth rather than performance growth that’s boosting its stock price. So it might not last long. But when a drop happens, I buy it in bulk and hold on for decades.
Both of these companies are solid stocks that have grown immensely over the past few years, if not months. But while one has a proven record of immense growth, the other has only recently been. So it’s clear where Motley Fool investors should put their money today.