Where was I? This FTSE 100 growth stock is leaving the index in the dust!
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Is the FTSE 100 make investors rich? Many people might write it off as a dividend stock full of strong but stable businesses.
The fastest action is in the US market, some would argue, where powerful tech companies defy rating rules and rise to the top without a care in the world.
Prominent home-grown players
However, the Footsie among them has strong market movers that have been leaving the overall index performance far behind.
What is strange to me is that I have been asleep at the wheel with one of them. But if I had been careful, this growing company could have boosted my portfolio.
It's time to correct that mistake of omission and focus on this growing love with the intention of taking action. The business in question is InterContinental Hotels Group (LSE: IHG).
Who would have thought? I blinded myself by thinking that the hotel operator was a revolving leaf blowing in the wind of great economic change. Yes, in the cyclical sector, of course, but that is not the whole story. This juggernaut has been growing, and fast!
Just look at the chart for a snapshot of the growth story here.
If I had been smart enough to invest £5,000 in shares 10 years ago, I would now have £19,350 in profits on top of that.
If I had invested £5k in InterContinental Hotels Group shares 20 years ago, it would now be worth around £60,500 plus all the dividends over the same period.
That's against the performance of the FTSE 100 as a whole, which would have grown my money to just £9,850, plus dividends, over the past two decades.
More progress
Is it too late to get involved in InterContinental Hotels Group shares? I do not think so. Today's third quarter trading update reflects steady progress and the continuation of the company's growth strategy.
In the nine months to the end of September, revenue per available room (RevPAR) increased by 1.5% year-on-year. At that time, in the measure of the size of this business monster, the company opened 17,500 rooms in 98 hotels at that time, which is “more than double the same period last year”.
The business now operates globally, but that adds risk. For example, the company is in places like China and other places that may not share the UK's global vision. So I see the company as vulnerable to the effects of geo-political conflicts and economic shocks.
In addition, there is uncertainty swirling around the sector – a modest recession would likely cause a loss of earnings and a drop in share prices.
However, with the growth and development of the wealthy and financially organized class of people in the world, I think that the demand for more corporate hotels will probably continue to grow.
Meanwhile, InterContinental Hotel Group's well-proven growth strategy may help deliver progress for shareholders in the coming years. So I'm digging in with deep research now with the goal of picking up a few stocks to hold for the long term.
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