It’s safe to say that everyone investing in the stock market does so with the hopes of living a comfortable retirement. However, in order to do so, investors need to pick the right companies. When looking for stocks to hold in a retirement portfolio, investors should filter out companies by figuring out which ones have potential to grow over the long term. This will help your portfolio continue growing over the years, replenishing your financial reserves as you take money out over time. Here are three stock to consider.
The winners in this industry will see massive growth over the next decade
If there’s one industry that I’m sure will continue to grow as the years pass, it’s the e-commerce industry. Over the past decade, consumers have slowly shifted towards online retail. However, over the past year and a half, e-commerce penetration has significantly accelerated around the world. This massive shift in consumer behaviour has largely been attributed to the COVID-19 pandemic. What’s interesting is that e-commerce sales continue to rise, even though physical shopping locations have reopened.
It’s becoming clear that Shopify (TSX: SHOP)(NYSE:SHOP) stands atop the industry. In Q2 2021, the company surpassed Amazon in quarterly customer traffic for the first time. Over that period, Shopify averaged 1.16 billion unique monthly users compared to Amazon’s 1.10 billion. Shopify stores also recorded US$6.3 billion in sales over the Black Friday-Cyber Monday weekend. Many investors were expecting the company to struggle to beat last year’s COVID-19-fueled online shopping sprees. I remain confident that Shopify belongs in every retirement portfolio.
This stock is a perfect example of sustained growth
Generally, growth rates slow down as a company grows larger in size. That’s simply the law of large numbers. That means if you’re able to find a company that can sustain a high growth rate as it scales, then you’ve most likely found a winner. Constellation Software (TSX: CSU) is a perfect example of sustained growth. Since its 2006 IPO, Constellation stock has gained more than 11,800%. That represents a CAGR of about 36%. This year, Constellation stock has gained 33%.
It’s very impressive that the company has managed to maintain this impressive growth rate through to 2021. This sustained growth may be attributed to the moves made by Constellation’s leadership team. In 2017, Constellation’s president Mark Leonard stated that he would be ceasing his annual letters in fears of competitors copying Constellation’s playbook. This suggests that the company remains dedicated to growth. In 2021, he ended his silence to announce that Constellation would finally start targeting large VMS companies for acquisition.
The business world is increasingly becoming digital
Wherever you look in the business world, you may be able to see new pieces of technology helping make day-to-day operations easier for everyone involved. This is true with regards to payroll, accounting, customer relationship management, and more. Docebo (TSX: DCBO)(NASDAQ: DCBO) is an example of a company bringing new technological solutions to enterprise training. It provides a cloud-based and AI-powered eLearning platform to enterprises.
Investors noted that businesses would need to shift to some sort of online training system once the pandemic hit. As a result, Docebo stock soared about 400% last year. Despite those large gains, Docebo is still only valued at about $3 billion. With customers like Amazon and Thomson Reuters already under its belt, I find it hard to believe that this company won’t be worth a lot more by the end of the decade. Even though businesses are returning to in-person operations, it’ll be hard to convince them to re-haul their training programs again so soon after a major change.
