When the business does well, the share price will naturally follow.
These are the wise words uttered by famous investor Warren Buffett.
Although there are numerous challenges facing companies now with high inflation and surging interest rates, several companies have bucked the trend by posting better profits.
Unsurprisingly, their share prices have also risen in tandem to hit close to a year high.
It pays to analyse these businesses to see if they can continue to do well.
If so, they are worth considering as an addition to your buy watchlist.
Here are three US growth stocks that not only announced higher profits but whose share prices are also close to their 52-week highs.
Rollins (NYSE: ROL)
If you ever have a nasty pest infestation within your residence, Rollins is the company you should contact.
The company provides pest control services and protection against a variety of pests such as termites, rodents, and insects and serves 2.8 million customers globally.
Shares of Rollins recently closed at US$41.98, up nearly 19% in a year and are trading close to their 52-week high of US$43.06.
For its fiscal 2023’s first quarter (1Q 2023), the pest control company saw revenue rise 11.4% year on year to US$658 million.
Operating profit climbed 20.2% year on year to US$112.2 million while net profit increased by 19.6% year on year to US$88.2 million.
Free cash flow improved by 17.1% year on year to US$93.1 million, and the company doled out a quarterly dividend of US$0.13, 30% higher than the US$0.10 paid out a year ago.
Early last month, Rollins completed the acquisition of Fox Pest Control for US$350 million.
Fox Pest Control’s business is complementary to Rollins and provides it with attractive growth opportunities.
The purchase is projected to bring in US$90 million to US$100 million of sales in 2023 and is expected to add to profit and cash flow in its first year.
Visa (NYSE: V)
Visa is a market leader in digital payments and acts as a middleman in facilitating payment transactions between consumers, merchants, financial institutions and government entities in more than 200 countries and regions.
Shares of Visa closed at US$230.47 recently, up around 13% in the past year, and are hovering near their 52-week high of US$235.57.
For Visa’s fiscal 2023’s second quarter (2Q FY2023) ending 31 March 2023, revenue rose 11.1% year on year to US$8 billion.
Operating profit improved by the same quantum to US$5.3 billion while net profit climbed 16.7% year on year to US$4.3 billion.
Visa generated US$7.6 billion of free cash flow for 2Q FY2023, 4% higher year on year compared to the prior year.
The company, which has around 4.2 billion credit and debit cards in circulation, reported a 19% year on year jump in cross-border volumes along with a 6% year on year increase in transactions.
Mondelez (NASDAQ: MDLZ)
Mondelez is a snack manufacturing and distribution company that sells iconic brands such as Oreo, Ritz, Cadbury Dairy Milk and Toblerone chocolates to customers in more than 150 countries.
Shares of Mondelez have risen by 18.4% in the past year and are now a whisker away from their 52-week high of US$78.59.
Revenue for 1Q 2023 rose 18.1% year on year to US$9.2 billion while operating profit surged 37.6% year on year to US$1.5 billion.
Net profit more than doubled year on year from US$855 million in 1Q 2022 to US$2.1 billion in the current quarter.
Along the way, Mondelez also generated a positive free cash flow of US$900 million.
The company has revised its 2023 forecast upwards as it expects better business moving ahead.
It expects organic net revenue growth of 10% or more year on year while earnings per share may also climb 10% year on year.
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Disclosure: Royston Yang owns shares of Visa.