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A petite number of growth stocks in your portfolio can really boost your returns. And with the Stocks and Shares ISA deadline approaching, now could be a good time to boost your portfolio.
Here are two unseen growth contributors worth thinking about.
AIM Wrestling
First there is Side (LSE:BOKU), an AIM-listed fintech company specializing in local payment methods (LPM). It helps sellers boost sales to people who pay for goods and services via mobile phones. The Boku network enables the implementation of over 300 LPM worldwide.
Believe it or not, today more people pay using LPM than via Visa Or MasterCard. Indeed, entire regions such as Southeast Asia are effectively ditching bank cards and moving directly from cash to LPM.
How? Well, people without a bank account simply go to their local store with cash and top up their digital wallet, which can then be used for e-commerce and streaming services.
What I like here is Boku’s list of biggest clients – it calls itself “the payment network trusted by tech giants“Like this helps Netflix AND Spotify Reach more subscribers around the world by connecting to your mobile phone bills. Also supportive Amazon in Japan.
Last year, Boku’s revenue increased 30% to $128.8 million, while operating profit increased 205% to $18.9 million. Bundling revenues increased by 71%. The Management Board is confident that it can continue to organically boost revenues by over 20% in the medium term.
Looking ahead, I see one key risk is that Boku’s collection rate – the fees charged on transactions – could come under pressure as competition intensifies. Last year it was 82 basis points.
However, since October, the company’s shares have fallen 32%, reaching a forward price-to-earnings (P/E) ratio of 19.7. For a rapidly growing company with potentially many years of double-digit growth ahead of it, I think this is an attractive valuation.
FTSE250
The second stock is Nutrition used (LSE:APN) z FTSE250. Powered by JD sports fashionis a founder-led sports nutrition and wellness company.
The main concern I had as the company went public in 2024 was competition. There are plenty of companies offering protein shakes, pre-workout drinks, and supplements. What gives advantage to applied nutrition?
Well, its goal is to be the most trusted and pioneering brand in the market. It is making great strides in realizing these ambitions, securing shelf space at Asda, Tesco, Sainsbury’sand even Walmart in North America. Together with Morrisons, it launched a range of 53 high-protein meal and snack products.
Personally, I am a regular user of this company’s creatine products. I recently started taking Applied Nutrition’s “critical greens” powder, which is loaded with broccoli, celery, spinach, etc. and is therefore reassuringly gross (in a fit way).
That’s why I believe this trusted and pioneering brand has an advantage over its rivals. This becomes obvious when looking at the financials, with full-year revenue expected to be around £140m (up around 31% and above previous market expectations).
The operating margin of 26% is also very fit (no pun intended).
While a spike in inflation in the UK wouldn’t lend a hand, it’s an increasingly diversified global business (Latin America is growing strongly). The global sports nutrition and wellness market is expected to grow at a compound annual rate of 8%, reaching £279 billion by the end of 2028.
The forward P/E ratio here is just 18.3.
