Growth stocks grow above the industry average and hence deliver superior returns. Given the high growth rate of these stocks, investors are ready to pay the premium. So, these stocks trade at a higher valuation. However, these stocks are susceptible to market fluctuations. So, young investors with longer investment horizons can invest in these stocks to earn superior returns. If you are ready to invest, here are three top growth stocks for you.
The pandemic has inflicted some permanent changes to consumer behaviors. One of those changes is the increased adoption of online shopping. Along with this change, the secular shift toward the omnichannel selling model has made digital payments popular, benefiting Nuvei (TSX:NVEI). It serves its partners and merchants across 200 markets worldwide. Meanwhile, the company is making capital investments to expand its direct distribution channels and boost its eCommerce business.
Apart from organic growth, Nuvei’s strategic acquisitions provide significant growth drivers. The company is currently working on acquiring Mazooma Technical Services, Simplex, and Discover Global Network. Mazooma’s acquisition could strengthen its position in the online gaming and sports betting industry, while Simplex could expand its alternative payment methods portfolio. So, given the favourable business environment and its growth initiatives, I am bullish on Nuvei.
goeasy (TSX:GSY) is one of the top performers in the Canadian equity market this year, with its stock price rising by over 65%. Meanwhile, the uptrend could continue amid a growing credit market, growth in loans, and solid payment volumes. Until now, the company has acquired less than 3% of its addressable market. So, it has considerable scope for expansion.
Meanwhile, goeasy is also venturing into new markets, launching new products, and investing in technological advancements to expand its market share. Besides, the company acquired LendCare Holdings in April and strengthened its balance sheet by raising US$320 million through senior unsecured notes.
LendCare’s acquisition has added new vertices and accelerated its growth in the consumer credit market by expanding its product ranges and point-of-sale distribution platforms. Further, the company also rewards its shareholders with quarterly dividends, with its forward yield currently standing at 1.64%.
Converge Technology Solutions
Third on my list would be Converge Technology Solutions (TSX:CTS), which has returned over 120% this year. Its robust first-quarter performance and aggressive acquisition strategy have boosted its stock price. The company provides advanced analytics, cloud, cybersecurity, and managed services to a wide range of organizations. Amid the increased digitization of processes, the demand for the company’s services is rising.
Besides, the company also looks for strategic acquisitions to drive its growth. In the previous quarter, the company completed the acquisitions of CarpeDatum and Accudata Systems. These acquisitions had strengthed the company’s analytics, networking, and security capabilities.
Further, since the beginning of this quarter, the company has completed the acquisitions of Dasher Technologies and ExactlyIT and is working on closing Vicom Infinity and Infinity Systems Software acquisitions.
Further, Converge Technology Solutions had raised around $172.5 million last month through new equity offerings. So, I believe the company is well-equipped to carry out its future acquisitions. So, given its healthy growth prospects, I believe Converge Technology Solutions is an excellent buy right now.