Stocks that are expected to significantly grow their profitability in the future can add meaningful upside to your portfolio. Beadell Resources and Redbubble are examples of many high-growth stocks that the market believe will be upcoming outperformers. The list I’ve put together below are of stocks that compare favourably on all criteria, which potentially makes them a good investment if you believe the growth has not already been reflected in the share price.

Beadell Resources Limited (ASX:BDR)

Beadell Resources Limited operates as a gold producer in Brazil. Beadell Resources is currently run by Lawrence Jackson. With the stock’s market cap sitting at AUD A$185.01M, it falls under the small-cap group

BDR is expected to deliver an extremely high earnings growth over the next couple of years of 57.53%, driven by a positive double-digit revenue growth of 13.28% and cost-cutting initiatives. An affirming signal is when net income increase also comes with top-line growth. Even though some cost-reduction initiatives may have also pushed up margins, in the case of BDR, it does not appear extreme. We see this bottom-line expansion directly benefiting shareholders, with expected positive return on equity of 11.79%. BDR’s impressive outlook on all aspects makes it a worthy company to spend more time to understand. Could this stock be your next pick? Other fundamental factors you should also consider can be found here.

Redbubble Limited (ASX:RBL)

Redbubble Limited operates as an online marketplace that facilitates the sale and purchase of art and designs on a range of products between independent creatives and consumers in Australia, the United States, the United Kingdom, and internationally. Formed in 2006, and now led by CEO Martin Hosking, the company size now stands at 201 people and has a market cap of AUD A$314.74M, putting it in the small-cap group.

Driven by the exceptional 67.16% sales growth over the next few years, RBL is expected to deliver an excellent earnings growth of 60.23%. Profit growth, coupled with top-line expansion, is a positive indication. This is because net income isn’t artificially inflated by unsustainable activities such as one-off cost-reductions expected in the future. This prospective profitability should trickle down to shareholders, with analysts expecting the company to generate a positive return on equity of 13.20%. RBL’s bullish prospects on both the top and bottom lines make it an interesting stock to invest more time to understand how it can add value to your portfolio. Want to know more about RBL? I recommend researching its fundamentals here.

Sovereign Metals Limited (ASX:SVM)

Sovereign Metals Limited engages in the identification, exploration, and appraisal of mineral resource projects. Sovereign Metals is run by CEO Julian Stephens. With the stock’s market cap sitting at AUD A$35.93M, it comes under the small-cap stocks category

SVM’s projected future profit growth is an exceptional 54.21%, with an underlying 59.09% growth from its cash flow from operations expected over the upcoming years. Profit growth, coupled with operating cash flow expansion, is a positive indication. This is because net income isn’t artificially inflated by unsustainable activities such as one-off cost-reductions expected in the future. SVM’s impressive outlook on all aspects makes it a worthy company to spend more time to understand. Interested to learn more about SVM? I recommend researching its fundamentals here.

For more financially robust companies with high growth potential to enhance your portfolio, use our free platform to explore our interactive list of these stocks.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.