The Tax-Free Savings Account (TFSA) is an excellent investment tool that has become popular among Canadians in recent years. Investors had little cumulative contribution room to work with when the TFSA launched in 2009. Those who managed to use the account to their advantages and maximized its benefits have successfully become millionaires.
Becoming a millionaire using this investment vehicle requires a keen eye for excellent growth opportunities. Today, the cumulative contribution room in a TFSA is $75,500, making becoming a TFSA millionaire in a few years a more attainable goal.
Why the TFSA is an ideal growth vehicle to become a millionaire
North American markets have proliferated significantly since the February and March 2020 pullback. While many investors lost significant returns last year, the economic fallout from the pandemic also created fertile ground for value-seeking investors. We have seen explosive growth in the tech and healthcare sectors amid the pandemic.
Today, I will discuss a stock that can offer you substantial returns by capitalizing on the favourable conditions in both industries.
WELL Health Technologies
WELL Health Technologies (TSX:WELL) is an excellent stock to consider. The stock has thrived in the face of the pandemic. At writing, the stock is trading for $7 per share, boasting a return of over 270% in the last 12 months. The stock’s five-year returns are even greater. WELL Health Technologies’s current valuation represents returns of 6,263.64% in the last five years, despite a significant pullback in February.
WELL Health focuses on providing omnichannel healthcare services across North America. The demand for telemedicine services is rising given its sustainability, accessibility, cost effectiveness, and convenience. The company is also looking to aggressively expand its geographical footprint through strategic acquisitions.
WELL Health recently announced acquisitions of Intrahealth Systems and CRH Medical. These deals could drive the company’s annual revenue to above $300 million.
The stock is trading for a discount of over 24% from its February 2021 peak. The broad tech sector pullback has created an excellent opportunity for investors to buy its shares on the dip.
If you invested $20,000 in the stock five years ago, your investment would be worth over $1.2 million in the space of just five years. While a similar growth in the next five years is not guaranteed, the stock has the potential to provide substantial returns to its shareholders in the long run.
Foolish takeaway
I want to point out that the past performance of a stock does not necessarily mean that its growth in the future will be similar. However, the surge in the importance of telehealth technology amid the pandemic has laid the groundwork to revolutionize healthcare.
You can expect the stock to deliver stellar returns on the back of its solid financial performance combined with the company’s strategic acquisitions and increasing telehealth adoption worldwide. I believe that its growing scale, global expansion, and favourable industry trends could make it a millionaire-maker stock to consider adding to your portfolio.
