When you decide to buy high-quality Canadian growth stocks in your TFSA, there are a tonne of benefits. Growth stocks have the ability to earn you significant returns, especially over the course of several years.
But not every Canadian growth stock you buy has to have a business that can grow exponentially. Often, growth stocks are thought of as high-risk, high-reward tech stocks, and there are certainly a tonne of those on the market.
However, you can also find growth stocks that might not grow so rapidly or double in the short term but can consistently expand their operations for several decades, making them highly reliable.
So, if you’re looking for these high-quality Canadian growth stocks to buy in your TFSA that you can own for years, here are two of the best to consider today.
A top environmental services stock
One of the best Canadian growth stocks to buy in your TFSA is GFL Environmental (TSX: GFL)(NYSE: GFL), an environmental services stock with non-hazardous solid waste management operations across Canada and the United States.
The company is an excellent core business to own and is quite defensive. However, GFL also has a tonne of opportunities to continue growing by acquisition. Over the last year, the company’s revenue has grown by more than 40%, thanks in large part to strong contributions from its acquisitions in its solid waste and liquid waste operations.
For 2022, the company’s guidance estimates it will do roughly $6.3 billion in revenue and roughly $1.7 billion in adjusted EBITDA. That would be growth for GFL of 14% and 16%, respectively, and values GFL at an enterprise value-to-sales ratio of 3.4 times and a forward enterprise value to EBITDA ratio of 12.2 times.
Right now, five analysts cover the stock, and all five have a buy rating on it. Furthermore, the average analyst target price is upwards of $56, which is a more than 50% premium to today’s price.
So, if you’re looking for one of the best Canadian stocks to buy, not only is GFL an excellent long-term investment, it’s trading undervalued today.
One of the best Canadian energy stocks to buy now
In addition to GFL, another high-quality Canadian stock to buy now, especially in the current environment, is Freehold Royalties (TSX: FRU).
Freehold is an energy stock that doesn’t produce oil or natural gas itself. Instead, it acquires land, which it leases to other producers. This is a lower-risk business model, which is why Freehold is an energy stock you can plan to hold long term.
Ever since the initial shock of the pandemic and subsequent impact on energy stocks, Freehold has had an incredible recovery and increased the dividend several different times.
And with the pandemic now essentially in the rearview, especially for energy stocks, Freehold is looking forward at ways to continue to grow shareholder value. So, in addition to receiving the monthly dividend, which has an annual yield of 5.3%, you can expect the company to continue to expand its portfolio and grow the price of the shares.
Therefore, given its lower-risk nature and the fact that energy stocks have a significant tailwind at the moment, Freehold is easily one of the best Canadian stocks to buy now.
