Recent Examples of growth company from the Web
An edtech growth company lighting up student financial services, #OneOfaKindness is the heart of its #awesome employee-centric, family-first approach.
Perhaps one of the more controversial changes among value investors is the drift toward growth companies.
The firm makes majority and minority investments in high-growth companies, with a focus on the technology sector.
Young, high-growth companies are responsible for a disproportionate fraction of net economic growth.
Investing money back into the business and burning through cash to roll out a new product is typical for a growth company.
But the Fed also matters, because tech firms are high-growth companies that ought to be able to increase profits even if the economy does little.
Some of the rise in Roku’s shares comes from an investor base hungry for growth companies to bet on.
Shale producers traditionally market themselves as growth companies.
These example sentences are selected automatically from various online news sources to reflect current usage of the word 'growth company.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.
Financial Definition of GROWTH COMPANY
What It Is
Growth companies are fast-growing, higher-risk companies. They tend to be young. Their stocks offer a higher chance of higher returns and a higher chance of losses.
How It Works
The nature of a company's business determines many of the characteristics of its stock, especially for growth companies. For example, blue-chip stocks are stocks issued by high-quality, large companies and generally have steady dividend payments. Their values don't "jump around" as much as shares of smaller, riskier companies like growth companies, generally speaking, and so conservative investors who like dividend payments and not much risk tend to avoid growth companies.
Growth companies are generally riskier than other types of companies, but their stocks also offer a chance at very high returns. These returns are often in the form of capital gains rather than dividends. Tech companies are generally good examples of growth companies -- they tend to reinvest all excess cash into their businesses and rely heavily on research and development of products that can be very lucrative but easily outdated.
Why It Matters
Deciding whether to buy stocks of growth companies, or which growth stocks to buy requires you to consider your goals in life, your age, your cash needs, future cash needs you might have (retirement, college, etc.), your tax situation, the nature of your other investments, and how much risk you're willing to take. For those willing to tolerate the risk, the rewards can be quite large (and the losses can be quite large).
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