2 Growth Stocks to Buy and Hold Forever

Here are two growth stocks to buy and add to your portfolio as 2022 begins.

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2022 has begun, and the S&P/TSX Composite Index posted a very strong year, despite all the pandemic-related challenges. The Canadian benchmark index did not end the year on a very bright note. At writing, the index is up by 21.12% year to date, but it is down by over 2% from its latest all-time high in November 2021.

Despite all the volatility in the weeks leading up to 2022, the TSX showed us that even a global health crisis is not enough to stop its growth. The instability in the markets leading up to the new year might be causing a lot of concerns for investors. However, the Canadian equity markets will likely be posting further gains this year if the pandemic situation gets even slightly better than in 2021.

The market volatility might likely continue for a few more weeks, but investors who can stomach some instability might not mind looking for growth opportunities that have the potential to post market-beating returns. Today, I will discuss two such Canadian growth stocks that you could consider adding to your investment portfolio.

Constellation Software

Constellation Software (TSX:CSU) is a Canadian tech stock that might not be as well known as the likes of other growth stocks in the tech industry, but it is an investment you cannot shrug aside if you’re interested in wealth growth. The tech sector boasts many hyper-growth names, and Constellation Software is not one of them. Constellation Software is a $49.27 billion market capitalization company founded by former venture capitalist Mark Leonard.

The company acquires vertical market software businesses and grows them through its experienced management team to fuel its own growth. The last five years have seen Constellation Software stock deliver consistent 30% returns to its shareholders. While it might not offer the rapid growth of Shopify stock, Constellation Software is a tech stock that could provide you with significant long-term upside.

goeasy

goeasy (TSX:GSY) is a $2.91 billion market capitalization alternative financial company headquartered in Mississauga. It operates three business segments that offer loans to subprime borrowers who cannot secure loans from traditional lenders in Canada. Business has been booming for goeasy amid the pandemic, as it provides high-interest loans that generate significant profit margins for the company.

Rising inflation rates and the Omicron variant have added considerable instability to the stock market. Operating environments like these bring in more business for subprime lenders. 2022 could see the country fully reopening, which could lead to a surge in consumer spending. Coupled with rising inflation rates, it could likely increase the demand for goeasy’s services and boost its revenues.

Foolish takeaway

If you already have a well-balanced, self-directed portfolio, and you want to add some growth to it, choosing the right growth stocks from the TSX could provide you with the boost you need. Remember that investing in growth stocks always entails a significant degree of capital risk. However, making a calculated risk in the right companies could set you up for stellar shareholder returns.

Constellation Software stock and goeasy stock could be good additions to your investment portfolio for this purpose.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns and recommends Shopify. The Motley Fool recommends Constellation Software.

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