Top 3 Growth Stocks for 2010 (WCRX, POT, FSLR)

Will 2010 be a hot year for Growth Stocks? Whenever the economy recovers, I expect a huge move in Growth Stocks. Even if the economy doesn’t recover, the following 3 Growth stocks should stay healthy and even provide a decent return in 2010. My picks are: Warner Chilcott Plc (NASDAQ:WCRX), Potash Corp./Saskatchewan (NYSE:POT) and First Solar, Inc. (NASDAQ:FSLR).

Warner Chilcott (WCRX)

NFY (Next Fiscal Year) Revenue Growth: 132.14%

Warner Chilcott has some amazing growth prospects, and looks to be severely undervalued. In the last twelve months the company reported revenues of $992.09M, add 132% to that and the company will be doing over $2B in 2010. Another aspect that I like about WCRX is this profit margins – the profit margin is 41.2% and operating margin is 30.52%.

The company’s largest contributor to sales in 2010 is expected to be that of its Loestrin 24 FE drug, which is designed to prevent pregnancy in women. Revenues from the drug are expected to increase at a CAGR of 59%, from $44 million in 2006 to $284 million in 2010.

Potash Corp/Saskatchewan (POT)

NFY (Next Fiscal Year) Revenue Growth: 64.86%

Keep an eye on Potash prices before jumping into this one - A ton of the fertilizer in China, the largest buyer and lowest-cost importer of potash, is expected to drop in price to $300 from $400 a few weeks ago, Soleil Securities analyst Mark Gulley wrote in a client note.

However, there are a lot of different views on where Potash prices could be in the next year.

Patricia Mohr, vice-president of Scotia Economics, said the average price for potash will likely be lower in 2010 than in 2009.

"For 2010, my own price forecast is an average of $375 US per ton and that assumes prices go back up to $400 in late 2010," Mohr said in a recent interview.

The economist's figures indicate the average price for a ton of potash in 2009 was around $614, a 4.5 per cent drop from 2008's average of $643.

Mohr also said: "I think the prices will start to firm up again possibly by the spring, but probably more likely in the second-half of 2010, and when you get to 2011 you should be in quite a firm market again for potash," she said.

Bottom line: keep an eye on Potash Corp/Saskatchewan (POT) and Potash prices and news in 2010. Soleil’s downgrade last week as sent shares of POT tumbling, so look for a good price to pick up shares. Shares of Potash are a steal anywhere south of $80.

First Solar (FSLR)

NFY (Next Fiscal Year) Revenue Growth: 32.78%

I have nothing new to add to the Solar Energy argument. However, I will say that FSLR is a well run company and Wall Street expects Revenue to grow 32.78% in 2010. That’s pretty big for a company that already generates $1.86B on an annual basis. Just looks at the fundamentals on FSLR, Profit Margins are generous, Revenue and Earnings are growing like nobody’s business. First Solar is the kingpin and best of breed of Solar Stocks. This week they released news of a major capacity expansion. With such a strong financial profile, it's no surprise that First Solar is comfortable expanding its current capacity by nearly 50%.

Note: All Revenue Growth Projections from Scottrade