Classic-growth companies are the stalwarts of the investing world: If the S&P 500 were a stock, it would fit in the classic-growth category. While their growth rates aren't setting the business world on fire, classic-growth companies are growing respectably faster than the general economy and most pay a modest dividend. These companies are also generally mature firms that have relatively predictable, visible earnings.
Unlike speculative-growth companies, classic-growth firms have plenty of profitability to go with their growth. Classic-growth companies are generally better established than speculative- and aggressive-growth companies, and they have a core business or businesses that are mature and solidly profitable.
McDonald's MCD fits the classic-growth type to a T. Demand for its hamburgers and fries is steady from year to year, and its powerful brand name has helped it garner an impressive track record of growth for a company of its size.
How Fast Has It Been Growing? >>