3 TSX Stocks to Buy With $1,000 Right Now

Got $1,000 to invest? These three TSX stocks can deliver multi-fold returns in the medium to long term.

| More on:
Happy shoppers look at a cellphone.

Source: Getty Images

With the retreat in share prices, investors have plenty of investment opportunities. While several top TSX stocks are now trading considerably below their highs, a few have the potential to recover fast and deliver stellar returns in the medium to long term. So if you could spare $1,000, let’s focus on three TSX stocks that can reach their 52-week highs fast and create new highs.

Aritzia 

Aritzia (TSX:ATZ) is a vertically integrated fashion house, shares of which are down about 21% from their 52-week high. This consumer discretionary stock benefits from the strong demand for the company’s products. The company supports full-price selling of women’s fashions. 

It’s worth highlighting that the company’s sales and earnings have increased at a double-digit rate since 2016. Its revenue and adjusted net income have a CAGR (compound annual growth rate) of 18% and 28%, respectively. Furthermore, in the first half of FY23, Aritzia’s top line marked 56.5% growth despite macro headwinds. Also, its adjusted EPS registered an increase of 38.6%. 

Aritzia projects its net revenue to reach $3.5–$3.8 billion by FY27, implying a CAGR of 15-17%. Also, its bottom line growth is expected to exceed sales growth. 

The ongoing strength in its e-commerce and retail channel, momentum in the U.S. business, new boutique openings, and expansion in new segments will support its growth and drive its stock price higher. 

goeasy

goeasy (TSX:GSY) stock is down about 43% from its 52-week high and looks attractive at a price-to-earnings multiple of 7.7, which is lower than the pre-COVID level of over 11. While goeasy stock is trading at a discount, it continues to deliver robust sales and earnings growth that shows the strength of its business model. 

So far, in 2022, goeasy’s top line has increased by 26%, which is well above its historical growth rate of approximately 16% (its revenue grew at a CAGR of 16% since 2011). Also, its bottom line recorded an increase of 11% year to date, which is encouraging. 

It continues to benefit from higher loan originations and steady credit and payment performance. Moreover, it returns substantial cash to its shareholders through higher dividend payments.

Management projects double-digit revenue growth in the foreseeable future and expects to expand operating margins by 100 basis points annually. Also, its net charge-off rate is well within the target range. Overall, goeasy is poised to deliver solid returns on the back of solid financials and boost shareholders’ returns through consistent dividend payments. 

Shopify 

Down about 76% from its 52-week high, Shopify (TSX:SHOP) is a top tech stock to buy and hold at current levels. Thanks to the significant decline, Shopify stock is trading at a next 12-month enterprise value-to-sales multiple of six, which is at a multi-year low. While Shopify’s valuation reflects its strong competitive positioning in the e-commerce space, investments in its platforms and products, and secular sector trends bode well for growth. 

The increased adoption of its POS (point-of-sale) offerings, expansion into new markets, and partnerships with social media companies augur well for growth. Further, Shopify faces easier year-over-year comparisons in the coming quarters, which will likely support its growth. 

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Aritzia and Shopify. The Motley Fool has a disclosure policy.

More on Investing

Business success with growing, rising charts and businessman in background
Investing

Could This Canadian Stock Be in for a Gigantic Meme Rally?

Could Cineplex become the next Canadian meme stock to see incredible gains, or will this company wither in obscurity?

Read more »

Target. Stand out from the crowd
Stocks for Beginners

3 Must-Buy TSX Stocks for Anyone New to Investing

Are you new to investing? These three TSX stocks for income, value, and growth are must-buys for any Canadian investor…

Read more »

grow dividends
Stocks for Beginners

After the Spinoff, Brookfield Stock Rose 16% in January

Brookfield stock is a wonderful business with a track record of delivering annualized returns of over 16%. And it's cheap…

Read more »

Businessman holding AI cloud
Tech Stocks

2 AI Stocks to Watch in February 2023

Those looking to invest in AI stocks can consider companies such as Nvidia and CrowdStrike Holdings right now.

Read more »

edit Woman calculating figures next to a laptop
Investing

Got $1,000? Buy This Growth Stock Before it Takes Off

Docebo (TSX:DCBO) is a great stock for long-term investors to buy and hold at these depths.

Read more »

A worker uses a double monitor computer screen in an office.
Tech Stocks

Better Buy: Shopify Stock vs. Lightspeed Stock

Shopify (TSX:SHOP) stock and Lightspeed (TSX:LSPD) stock both had their time in the sun, but which will feel the heat…

Read more »

tsx today
Energy Stocks

TSX Today: What to Watch for in Stocks on Thursday, February 2

More corporate earnings reports could give further direction to TSX stocks today.

Read more »

grow dividends
Dividend Stocks

2 TSX Stocks With a Dividend Bump Coming

These two top TSX stocks have lengthy dividend growth streaks and are high-quality companies, making them ideal investments for passive…

Read more »