Growth stocks are attractive to many investors because above-average financial growth makes it easy for these stocks to attract market attention and produce exceptional returns. But finding a high growth stock is not easy at all.

In addition to volatility, these stocks carry, by their very nature, above-average risk. Additionally, one could end up losing on a stock whose growth story has actually ended or is about to end.

However, it’s quite easy to find top growth stocks using the Zacks Growth Style Score (part of the Zacks Style Scores system), which looks beyond traditional growth attributes to analyze growth prospects. real assets of a company.

General Motors (GM) is on the list of such stocks currently recommended by our proprietary system. In addition to a favorable Growth Score, it sports a top Zacks Rank.

Research shows that stocks with the best growth characteristics consistently beat the market. And for stocks that combine a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy), the returns are even better.

Here are three of the most important factors that make this automaker’s stock a great growth pick right now.

Earnings growth is arguably the most important factor, as stocks with exceptionally high earnings levels tend to attract the attention of most investors. And for growth investors, double-digit earnings growth is clearly preferable and is often an indication of strong prospects (and stock price gains) for the company under consideration.

While the historical EPS growth rate for General Motors is 23%, investors should actually focus on projected growth. The company’s EPS is expected to grow 33% this year, crushing the industry average of 1% EPS growth.

Growth investors often overlook the asset utilization ratio, also known as the sales-to-total assets (S/TA) ratio, but it is an important characteristic of a true growth stock. This metric shows how effectively a company uses its assets to generate sales.

Currently, General Motors has an S/TA ratio of 0.65, meaning the company makes $0.65 in sales for every dollar of assets. Comparing this to the industry average of 0.42, we can say that the company is more efficient.

If the level of efficiency in generating sales is very important, so is a company’s sales growth. And General Motors is also well positioned from a sales growth perspective. The company’s sales are expected to grow 4.4% this year, compared to the industry average of 0%.

The story continues