3 Growth Stocks You Can't Afford to Miss

As investors, we all want to pick great stocks that will reward us for years on end. Unfortunately, sorting the winners from the losers can be tricky. Pricey valuations, sky-high P/E ratios, low margins of safety, and unproven business models often mask the truly disruptive growth stories.

No matter which way you cut it, investing in growth stocks is risky. But it can also be extremely rewarding. I experienced this firsthand in 1998 when I purchased shares of Apple (NAS: AAPL) for $27 apiece. I still own most of those shares today, only now the stock trades at around $646 a share. Of course, not all of my picks fared as well. Nevertheless, finding the next Apple is about looking to the future of a company, and being comfortable paying a premium for superior profits down the road.

Below I highlight three stocks that I believe every growth-oriented investor should own today.

First-mover advantages
When it comes to growth stocks, a good place to start is with industry leaders. If you ask Motley Fool co-founder David Gardner about his approach to finding mind-blowing growth stocks, he'll tell you to look for top dogs and first-movers in important and emerging industries. With these criteria in mind, one company in particular stands out: Intuitive Surgical (NAS: ISRG) .

The company, which makes robotic surgical equipment, posted solid third-quarter earnings on Tuesday. Revenue jumped 20% in the quarter, with earnings-per-share climbing 46% from the year-ago period. Still, not all investors were happy with the results. That's because, as with Apple, investors expect a lot from Intuitive Surgical.

Going forward, one of the main profit drivers for Intuitive will be the instruments and accessories segment, whose sales jumped 24% year over year. Future growth will also be powered by an increased focus on using its da Vinci robotic system to perform new procedures. Additionally, Intuitive should continue to benefit from its first-mover advantage even as competition increases in robotics-assisted surgery.

For more proof that Intuitive Surgical is an industry leader, just look at its performance relative to other robotic names in health care.

ISRG Chart
ISRG Chart

ISRG data by YCharts.

All told, I think the stock has more room to run, despite being up more than 15% year to date.

Thinking ahead
Short-term thinking won't get you very far when it comes to finding winning growth stocks. That's why one of my favorite high-growth picks is a company that's sacrificing current profits for future profitability. Enter Amazon.com (NAS: AMZN) . The e-commerce giant has no shortage of critics, but that can work to our advantage. You see, negative press, especially over a stock's valuation, keeps some investors on the sidelines -- at least until later in the game when the same investors jump in at a higher price.

Amazon's disruptive nature speaks for itself. Since Jeff Bezos founded the company in 1994, it has had huge impacts on numerous industries, from bricks-and-mortar retailers to logistics and delivery services. As the world's leading e-commerce site, Amazon has positioned itself as a retail powerhouse. Today, Amazon takes many great products, services, and businesses and wraps them into one. The e-tailer rang in net sales north of $48 billion last year.

The company's new website, AmazonSupply.com, should help the retail giant capitalize on another lucrative market: B2B customers. Meanwhile, Amazon's gateway drug, Amazon Prime, is another catalyst for growth. For just $79 a year, Prime members have access to free two-day shipping on an unlimited number of deliveries, as well as unlimited streaming videos. At the end of the day, Prime is helping Amazon attract new customers to its growing library of digital media products.

It's also encouraging that founder and CEO Jeff Bezos maintains a 20% stake in the company. With Bezos at the helm, I expect the company to continue to prove the critics wrong.

More than just a pretty face
This next stock fits the bill in terms of disruptive technology and strong consumer appeal. As a high-performance electric-car maker, Tesla Motors (NAS: TSLA) has already overcome seemingly insurmountable odds to get where it is today. With its Model S now in production, Tesla has seen reservations for the zero-emission luxury sedan more than double in the past year.

Still, Tesla remains a risky investment because widespread consumer adoption of electric vehicles isn't yet a sure thing. In an attempt to change this, Tesla recently launched a Supercharger network in California. Today there are six Supercharger stations in operation, and Tesla plans to install over 100 more solar-powered carports across the United States by 2015.

These electric fueling stations are not only free to use, but they also return more power to the grid. What this means is that Tesla drivers will be able to make a cross-country trip for free without a drop of gas -- yet another powerful incentive for consumers to drive EVs.

This doesn't change the fact that Tesla is one of the more speculative growth stocks. However, given the company's visionary leadership in Elon Musk (think SpaceX and PayPal), these are risks I'm willing to take. The Tesla CEO also holds more than a 28% stake in the company. I think investors with a longer time horizon, say, three to five years, would be wise to own the stock. That's why I've given it a five-year outperform rating on Motley Fool CAPS.

The payoff
Given the various catalysts covered above, I expect these stocks to generate above-average earnings growth for years to come. That's why I plan on owning these names over the long haul. Depending on your risk tolerance, investing in high-growth stocks can mean the difference between mediocre returns and superior returns.

One thing to keep in mind: Things change. Because buying a growth stock means you're buying a company based on future expectations, it's important to re-evaluate a stock's investment thesis along the way. As one of my top growth picks, Amazon is a great example of this. Shares of Amazon have been extra-sensitive to investor worries over its sky-high valuation.

If you want to know more about the top e-tailer in the world, be sure to read our new premium report. Inside, we'll explain what's driving Amazon's growth, as well as show you whether Amazon is a buy or a sell today. Our report also has you covered with a full year of free analyst updates to keep you informed as the company's story changes, so click here now to read more.

The article 3 Growth Stocks You Can't Afford to Miss originally appeared on Fool.com.

Fool contributor Tamara Rutter owns shares of Apple, Amazon.com, and Tesla Motors. Follow her on Twitter, where she uses the handle @TamaraRutter, for more Foolish insights and investing advice. The Motley Fool owns shares of Apple, Amazon.com, Intuitive Surgical, and Tesla Motors. Motley Fool newsletter services recommend Amazon.com, Apple, Intuitive Surgical, and Tesla Motors . 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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