The Best Deals in High Growth Stocks

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The stock market has had quite the run since the Great Recession, with the broad-based S&P 500 returning better than 200% in a little over six years. Investors who decided to stick with their holdings over the long-term have likely been amply rewarded.

But the flipside to the above statement is that good values are getting a lot tougher to find. The S&P 500 hit its highest forward P/E ratio in 11 years earlier in 2015 according to FactSet, while noted economist Robert Shiller suggests the current P/E of the S&P 500 may be closer to 27 using the cyclically adjusted price-earnings ratio, or CAPE, ratio, which looks at the S&P 500's earnings over a 10-year period.

The best deals in high growth stocks While it's true that finding great deals isn't as easy as it used to be, the good news is that there are still quite a few high growth stocks with attractive valuations based on their projected sales and profit growth over the next four years.

Today we'll briefly take a closer look at five companies that I've arbitrarily dubbed the "best deals in high growth stocks," stocks that boast average annual sales growth paths of 10%-plus through 2018 and PEG ratios (price-earnings to growth ratios)around or below onein 2018 based on Wall Street's current EPS consensus. A PEG around (or below) one often implies a good value, and may signify the potential for more share price appreciation.

As always, treat these selections as a jumping off point for further research and not as concrete signals to blindly click the "buy" button.

Source: U.S. Food and Drug Administration via Facebook.

1. Celgene We'll begin with a quick jaunt through the healthcare sector, where Celgene appears to me to be one of the best deals among a sea of high growth stocks.

What makes Celgene so attractive is that its growth is almost entirely organic. Increased demand and price growth from its blockbuster cancer drug Revlimid -- a standard of care in treating multiple myeloma -- as well as the potential for label expansions for Revlimid, cancer drug Abraxane, and anti-inflammatory drug Otezla should allow Celgene to double its sales between 2014 and 2018 to $15.4 billion from $7.7 billion.

Collaborations are another major growth driver for Celgene. It has more than 30 partnerships currently on its books (including a recently announced megadeal) which could land Celgene the licensing rights to a number of first-in-class therapies. These include CAR T-cell immunotherapies, cancer stem cell-targeted drugs, and various other compounds focused on all types of leukemias.

Based on Wall Street's projected EPS of $9.32 in 2018 and its average estimated sales growth of 18.9% between 2014 and 2018, Celgene's projected PEG ratio is a mere 0.67.

Source: NXP Semiconductors via Facebook.

2. NXP Semiconductors It might seem like finding good value in the technology sector is almost impossible, but highflier NXP Semiconductors, which will soon complete its merger with Freescale Semiconductors, could be an exceptionally good deal among high growth stocks.

The Freescale deal is transformative for NXP and its investors in that it moves the combined entity into the No. 4 slot for largest semiconductor manufacturers in the world excluding memory developers. As the leader in mobile payment-based and automotive solutions, the merger should only reinforce NXP's importance to these high-growth industries and improve NXP's leverage with its customers.

Buying into the NXP Semiconductor thesis is a bet on interconnected devices taking off in the next couple of years. We're already seeing this with sophisticated technology in our cars, smarter thermostats in our homes, and medical devices that will soon be able to provide real-time health data directly to our primary care physicians to improve the quality and success of treatment each person receives.

Based on the most up-to-date figures from Wall Street, NXP Semiconductors is projected to earn $7.39 per share in 2017 with an annual sales growth rate that rounds up to 10% (the cutoff for my arbitrary criteria). In total, we're looking at a reasonably low PEG ratio of 1.2, implying more upside could be warranted.

Source: Keurig Green Mountain via Facebook.

3. Keurig Green Mountain Even the consumer goods sector is home to one of the best deals in high growth stocks, with single-serve specialty coffee company Keurig Green Mountain making the cut.

The company's claim to fame is its single-serve Keurig brewing system, still the dominant choice among consumers looking to personalize their coffee-making experience. Per Keurig's annual report, it accounted for 30% of all U.S. coffee sales in 2014, and more than 20% of all U.S. households own a Keurig single-serve coffee system. Just as Starbucksgarners business based on its brand and reputation, Keurig has been able to use the cachet of its first-in-class single-serve brewing system to build a faithful following.

Looking ahead, Keurig's supercharged growth will likely come from international expansion, collaborations, and new product introductions, such as its Keurig Kold, a cold beverage brewing system. Let's not forget that Coca-Cola made a substantial investment in Keurig that currently amounts to nearly 26 million shares, or about a 16% stake in the company.

Keurig Green Mountain's EPS is estimated to grow by more than 50% between 2014 and 2018 to $6.16, while its sales are slated to grow by 16% per year. Overall, Keurig Green Mountain's PEG ratio of 0.7 is enticing.

Source: 3D Systems via Facebook.

4. 3D Systems Next we'll hop over to the industrial sector, where 3-D printing companies such as 3D Systems are looking to revolutionize the way businesses prototype and manufacture products.

The allure of 3-D printing companies is that they could dramatically lower business costs over the long run. Gone are the days of sending away for costly prototypes, which often had to be bought in bulk and refined. Nowadays components can be personalized and tweaked under one roof for minimal cost beyond the initial investment in the 3-D printing machine. Healthcare is another area where 3-D printing could represent an enormous growth opportunity. Imagine being able to print medical devices or organs at the push of a button!

3D Systems' method of growth over the past couple of years has been very much acquisition-based. The company purchased close to 50 companies over a little more than a three-year stretch, which as you might imagine has led to a little bit of integration indigestion. Once 3D Systems moves beyond its temporary new product snafus over the coming quarters its orders are expected to soar.

With an expected annual sales growth rate of 21% over the next four years and $1.24 forecast in EPS by 2018, 3D Systems' PEG ratio is a microscopic 0.65! That looks like a great deal.

Source: Facebook.

5. Facebook For the last of the best deals among high growth stocks we'll head back to the tech sector and highlight the king of all social media, Facebook.

Facebook's growth could be dangerously strong given its 1.25 billion mobile monthly active users and nearly 800 million daily active mobile users. These massive numbers are an advertiser's dream, allowing Facebook to command a pretty penny for those impressions. It's also worth noting that just 17% of Facebook's daily active users are located in the United States, so this is truly a global brand.

Innovation looks to be the driving force behind Facebook's growth in the coming years, with a payment platform and floating videos representing some of its latest interactive implementations. Let's remember that mobile is still relatively new and there's no concrete formula to profitability, meaning Facebook probably still has tweaks to make to beef up its mobile profitability.

Based on Wall Street's consensus estimates between 2014 and 2018, Facebook's sales should basically triple to $35.9 billon, with its EPS vaulting to $4.53 in 2018. This works out to a forward P/E of 19, an annualized growth rate of 30%, and a PEG ratio of a scant 0.63!

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Sean Williamshas no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen nameTMFUltraLong, track every pick he makes under the screen nameTrackUltraLong, and check him out on Twitter, where he goes by the handle@TMFUltraLong.The Motley Fool recommends 3D Systems, Celgene, Coca-Cola, Facebook, Keurig Green Mountain, NXP Semiconductors, and Starbucks. The Motley Fool owns shares of 3D Systems, Facebook, NXP Semiconductors, and Starbucks and has the following options: long January 2016 $37 calls on Coca-Cola and short January 2016 $37 puts on Coca-Cola. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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