Is Amazon (AMZN) a Solid Growth Stock? 3 reasons to think “yes”.

Investors look for growth stocks to benefit from the above-average growth of financial stocks, which helps these securities capture the market's attention and generate exceptional returns. But finding a good growth stock is not that easy.

In addition to volatility, these stocks naturally carry above-average risk. Plus, you could end up making a loss on a stock whose growth story has actually ended or is nearing its end.

However, finding cutting-edge growth stocks is fairly easy using the Zacks Growth Style Score (part of the Zacks Style Scores system), which goes beyond traditional growth characteristics to analyze a company's true growth prospects.

Amazon (AMZN) is one of these stocks that our proprietary system currently recommends. Not only does the company have a favorable growth stock, but it also holds a top Zacks Rank.

Studies have shown that stocks with the best growth characteristics consistently outperform the market. And the returns are even better for stocks that have a combination of an A or B Growth score and a Zacks Rank #1 (Strong Buy) or 2 (Buy).

Here are three of the key factors that make this online retailer's stock a great growth option right now.

Earnings growth is arguably the most important factor, as stocks with exceptionally rising earnings levels tend to attract the attention of most investors. And for growth investors, double-digit earnings growth is definitely preferable and is often an indication of good prospects (and share price gains) for the company in question.

While the historical EPS growth rate for Amazon is 15.9%, investors should actually focus on forecast growth. The company's earnings per share are expected to rise 75% this year, beating the industry average of 28.4% earnings per share.

Cash is the lifeblood of any business, but above-average cash flow growth is more beneficial and important for growth-oriented companies than for mature companies. Because high liquidity accumulation allows these companies to carry out new projects without having to raise expensive external funds.

Currently, Amazon's year-over-year cash flow growth is 59.4%, higher than many of its competitors. In fact, the rate compares to the industry average of -7.1%.

While investors should actually consider current cash flow growth, it's also worth taking a look at the historical rate to put the current value in perspective. The company's annual cash flow growth rate over the past three to five years was 25.3% versus the industry average of 8.8%.

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