Investing can help you to grow your wealth and achieve your dream of a happy retirement.
One method to work towards this goal is to park your money in dividend-paying stocks that generate a stream of passive income.
Another is to allocate money to growth stocks that can improve their earnings and cash flow over time.
As these businesses become more valuable, their share prices should also rise in tandem, yielding attractive capital gains.
As time goes by, you can compound your wealth by reinvesting dividends from income stocks into promising growth stocks.
This rinse-and-repeat cycle requires patience but is an effective way for you to grow your retirement nest egg.
Here are four US stocks displaying solid growth that could push the value of your investment portfolio higher.
ResMed (NYSE: RMD)
ResMed manufactures and sells digital health technologies and cloud-connected medical devices to help patients with sleep apnea and COPD (chronic obstructive pulmonary disease).
Its products are sold in more than 140 countries.
The company just released its fiscal 2023 (FY2023) earnings for the year ending 30 June 2023.
Revenue climbed 18% year on year to US$4.2 billion as its masks and patient interface businesses did well along with its residential software-as-a-service (SaaS) segment.
Operating income improved by 13% year on year to US$1.1 billion while net profit jumped 15% year on year to US$897.6 million.
In line with the good results, ResMed has increased its quarterly dividend by 9% year on year to US$0.48 per share.
Operating cash flow nearly doubled year on year to US$693.3 million for FY2023 while free cash flow soared 165.2% year on year to US$573.6 million.
During FY2023, the sleep apnea business acquired Somnoware, a company dealing with digital sleep and respiratory care software for sleep labs and physicians.
Asana (NYSE: ASAN)
Asana is a SaaS company that assists organisations to work smarter with a platform that helps teams share information and collaborate and also helps with capacity planning, product launches, and employee onboarding.
The company boasts global companies such as Amazon (NASDAQ: AMZN), Accenture (NYSE: ACN), and Roche (SWX: ROG) as its customers.
The software company reported a good set of earnings for its fiscal 2024 second quarter (2Q FY2024) ending 31 July 2023.
Revenue rose 20.4% year on year to US$162.4 million with gross profit increasing by 20.7% year on year to US$146.2 million.
Asana also generated a free cash flow of US$14.6 million for the quarter, reversing the negative free cash flow a year ago.
The business has more than 139,000 paying customers in more than 200 countries and territories.
Additionally, the number of customers spending US$100,000 or more jumped 20% year on year to 553.
DexCom (NASDAQ: DXCM)
DexCom is a healthcare company that manufactures and distributes continuous glucose monitoring (CGM) systems.
The company aims to simplify and improve diabetes management around the world.
For 2Q 2023, revenue improved by 25.2% year on year to US$871.3 million while operating income surged by 66.4% year on year to US$128.1 million.
Net profit more than doubled year on year to US$115.9 million from US$50.9 million a year ago.
The company’s free cash flow more than quadrupled year on year to US$212 million for 2Q 2023.
During the quarter, DexCom commenced commercial production at its Malaysia manufacturing facility.
The company sees a large total addressable market for its DexCom G6 CGM System as there are more than 25 million people in the US with Type 2 Diabetes who have not progressed to insulin therapy.
DexCom will tap on its digital health partnerships and pursue reimbursed access (through insurance tie-ups) to catalyse its growth.
Rollins (NYSE: ROL)
Rollins is a commercial services company that provides pest control services and protection against termites, rodents, and insects.
The company has more than 19,000 employees from more than 800 locations.
For 2Q 2023, Rollins reported a 14.9% year on year increase in revenue to US$820.7 million.
Operating income increased by the same percentage quantum to US$154.8 million while net profit improved by 8.4% year on year to US$110.1 million.
The business also generated a positive free cash flow of US$140.6 million, up 17.8% from the prior year.
Rollins also declared a quarterly dividend of US$0.13 per share, up an impressive 30% year on year from 2Q 2022.
Back in April, the company completed the acquisition of Fox Pest Control, which provides services to residential customers across 13 states in the US.
The acquired company is the 13th largest pest management company in America.
This transaction is expected to add to earnings in the first full year of ownership and will be financed by cash and existing credit facilities.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
