Increasingly, the Wall Street firms we cover are starting to agree that while the future for the U.S. economy is still bright, it may be one of stock market gains much lower than the norm over the past 10 years. When that is the case, then investing strategies often shift from indexing to a more disciplined stock-picking routine. That’s when investors need solid growth ideas.

Jefferies highlights the firm’s top growth stocks to buy each week, and this week is no exception. The firm is out with its first top growth stock calls for 2021. Many on Wall Street, including Jefferies analyst Aneta Markowska, are expecting big-time first-quarter gross domestic product prints, and she puts it at a stunning 6.4%. So, adding some exciting growth stocks now makes sense.

These four look like solid picks for more aggressive growth investors as they have significant catalysts that can drive growth for the rest of 2021 and beyond. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Catalent

This company could see a benefit from the rollout of COVID-19 vaccines and it is a top health care picks at Jefferies for 2021. Catalent Inc. (NYSE: CTLT) is a contract development and manufacturing organization (CDMO) for the pharmaceutical and biotech industries. It offers advanced drug delivery technologies, as well as drug development and manufacturing solutions for pharmaceuticals, biologics and consumer health products. Through its services and expertise, the company seeks to help customers bring products to market faster, enhance product performance and provide reliable clinical and commercial product supply.

Top analysts agree that Catalent’s long-term growth outlook of 6% to 8% is not only achievable but also conservative due to the company’s recent organic and inorganic investments. The company has pursued an aggressive mergers and acquisitions strategy to transform and increase its exposure to the biologics market. CDMOs have become increasingly important to biopharmaceutical companies as they help rationalize the latter’s supply chains as molecules become increasingly hard to develop and manufacture. Catalent was able to build an end-to-end CDMO that Wall Street feels is valued at a discount to peers.

Jefferies has a $115 price target for the shares, and the Wall Street consensus target is $112.64. The shares closed on Friday at $112.49.

Charles River Laboratories

This is one of the premier companies in its industry and perhaps a more conservative idea for growth investors. Charles River Laboratories International Inc. (NYSE: CRL) is the leading early-stage drug development contract research organization. It provides animal research models and preclinical drug development services to biopharmaceutical companies, government agencies and academic institutions.

The company also offers microbial and biologics testing solutions for the production and release of products manufactured by clients. Jefferies has stayed very positive on the company over the past year and noted this:

Biotech funding of $7.1 billion in December was up 41% year-over-year driven by strong growth from IPOs and venture capital, bringing the 2020 total to $88.1 billion. Though the unusual pandemic environment likely induced the mid-year surge, the persistence through year-end demonstrates investor appetite well above “normal” levels. Specifically, we highlighted that the magnitude and consistency of venture capital funding should be a positive for the company.

The Jefferies price target is $270, and the consensus target is $238. Friday’s closing share price was $271.01, after a 2% gain for the day.

This remains a compelling value at current trading levels, and copper pricing has been on fire. Freeport-McMoRan Inc. (NYSE: FCX) is the world’s largest publicly traded copper and molybdenum producer, and the eighth largest gold producer. Its key operating and development assets are in Indonesia, North and South America and Africa.

Highly leveraged toward copper mining, the company could be a big player in a scenario of rebuilding and repairing old and battered projects and would clearly benefit from stronger demand and higher prices for industrial commodities.

In November, PT Freeport Indonesia and Mitsubishi Materials signed a memorandum of understanding to expand the Gresik copper smelter and refinery. The expansion is projected to increase capacity by 300,000 tons per year, bringing total capacity to 1.3 million tons per year. Construction is expected to be completed in 2023, with financing of $250 million provided by PT-FI.

Jefferies has been bullish on the company and the sector for some time, and the research report said this:

We believe copper will benefit from secular demand drivers (EVs and renewable energy) as well as a cyclical recovery in demand ex-China starting this year. These demand drivers will more than offset a policy-driven slowdown in Chinese demand as tightening measures begin to impact some Chinese end markets, such as housing. As a result, we believe that the copper market has shifted into a multi-year deficit that will eventually be resolved by increased scrap supply, substitution, demand destruction and new mine capacity – all of which will be in response to higher prices.

Jefferies has set its price target at $35. The lower consensus target is $25.81, and Freeport-McMoRan stock closed at $31.15 on Friday.

Northrop Grumman

This was ranked as one of the top five defense contractors by sales last year. Northrop Grumman Corp. (NYSE: NOC) provides innovative systems, products and solutions in unmanned systems, cyber, C4ISR and logistics and modernization to government and commercial customers worldwide. It was also one of the companies profiting most from war.

The Aerospace Systems segment designs, develops, integrates and produces manned aircraft, unmanned systems, spacecraft, high-energy laser systems, microelectronics and other systems and subsystems.

The Information Systems segment offers advanced solutions for the Department of Defense, national intelligence and federal civilian, state, international and commercial customers. It provides products and services primarily in the fields of command and control, communications, cyber, air and missile defense, intelligence processing, civil security, health information technology, and government support systems.

The Technical Services segment provides logistics, modernization and sustainment services, as well as other advanced technology and engineering services, including space, missile defense, nuclear security, training and simulation services.

Shareholders receive a 1.92% dividend. The Jefferies price objective is $375. The consensus price target is $378.83. Northrop Grumman stock ended last week at $288.33 a share.

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These four top stocks for growth investors could be massive long-term winners. Again, after a huge rally that has put all the major indexes and the Russell 2000 at all-time highs, caution is clearly warranted here. It may be smart to buy partial positions, as fourth-quarter earnings season is right around the corner.

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