2 super growth stocks that are perfect for retirement

Costain Group(LSE: COST) may have endured no little earnings volatility over the past five years, but chunky back-to-back rises in the past two fiscal periods suggest that it is now back on the straight and narrow.

The construction giant saw profits jump by 26% and 10% in 2016 and 2017 respectively. And while City analysts are expecting bottom line rises to moderate in the medium term with increases of 6% forecast for this year and the next one, I reckon Costain is a great bet for those seeking sustained growth long into the future.

Indeed, the Maidenhead company's update last month assured me of its bright profits prospects. In 2017, revenues rose 4% during 2017 to £7.3bn and Costain said that its order book remained stable at £3.9bn as of December, with £1.1bn worth of sales secured for the current year.

The small-cap's focus on essential services like water, energy and transport means that the company can bank on reliable income growth. And as I noted last time out, rising investment in these areas is giving its revenues momentum an added injection of sauce.

An added bonus

What's more, Costain's bright profits outlook feeds into predictions that its dividends should keep growing at a mighty rate.

Last year's payout increased 10% year-on-year to 14p per share, and this is expected to rise to 15.8p in the current year and to 17.9p in the following period. As a consequence, yields sit at a significant 3.4% and 3.7% for this year and next respectively.

At current prices, Costain can also be picked up on a forward P/E ratio of 12.4 times. This is far too cheap given the firm's solid outlook, in my opinion.

Another growth great

Another hot growth stock that you need to check out today is Coats Group (LSE: COA).

The FTSE 250 firm has seen earnings swell by almost 80% over the past three years and the Square Mile's number crunchers are expecting this scintillating progress to continue. A 10% earnings improvement is estimated for 2018, and another 9% rise for next year.

Coats -- which manufactures threads and zips for the clothing industry, amog others -- may not be as cheap as Costain, although a forward P/E ratio of 15.5 times is hardly extortionate given its equally impressive earnings picture.

Thanks to market share grabs, the company's solid revenues momentum has continued, and full-year sales rose 4% in 2017 to $1.5bn. And the firm last month launched its two-year 'Connecting for Growth' transformation programme that looks set to keep business flowing in by setting itself up to cope with its fast-changing markets more effectively. The strategy is designed to "[add] value to our customers by being agile partners with an increased emphasis on speed, quality, value, innovation and corporate responsibility," it said. And it should also create annualised operating cost savings of $15m by 2020.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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