When a recession happens, it is not surprising for investors to begin panicking. With the fall of two banks across the border, many investors might start likening the current environment to the Great Recession of 2008. However, it might be different this time around. While it is easy to draw negative parallels, you must remember that the banks that crashed do not have a bearing on the broader economy.
There is no way to tell how long this bear market will continue. However, it will likely end eventually. Some analysts believe the next bull market is not too far away. During bear markets, growth stocks tend to trail the broader market. However, these stocks also deliver stellar returns during bull runs.
If you want to prepare your portfolio for the next bull market, here are two spectacular growth stocks you can consider adding to your self-directed portfolio for this purpose.
Aritzia
Aritzia (TSX: ATZ) is a $4.47 billion market capitalization Canadian fashion brand founded in 1984. After going public in 2016, the stock has seen substantial growth that has outpaced the broader market by a significant margin. The vertically integrated design house has over 100 retail locations throughout Canada and the U.S. and a rapidly growing online sales segment.
It has taken full advantage of the pandemic, developing a diverse catalog to focus on quicker fulfillment and deliveries. In a successful bid to accelerate its direct-to-consumer sales, Aritzia has gone from $980 million in sales during fiscal 2020 to $2 billion in the last four quarters. The stock will end fiscal 2023 with roughly $2.05 billion in sales, with retail accounting for over two-thirds of its revenue.
As of this writing, Aritzia stock trades for $39.09 per share, down by almost 30% from its 52-week high. It can be an excellent deal to consider for your portfolio at current levels.
Alaris Equity Partners
Alaris Equity Partners Income Trust (TSX: AD.UN) is a $772.58 million market capitalization open-ended trust that provides alternative financing to private companies through its subsidiaries. Think of it as a company that businesses look to when they need an injection of capital to remain sustainable.
Unlike other equity firms that offer financial bailouts to private companies in exchange for a stake in the business, it does not assume any control over the businesses it helps. Instead, Alaris Equity Partners enjoys only financial returns reflecting its investment with its partners.
For businesses that seek financial help without managerial interference, Alaris is the ideal resource. When a bull market arrives, it will be well positioned to take advantage of a flourishing business landscape to fuel its own growth.
As of this writing, Alaris Equity Partners stock trades for $17.05 per share and boasts a juicy 7.98% dividend yield you can lock into your portfolio today.
Foolish takeaway
Due to the cyclical nature of stock markets, you can draw both negative and positive parallels to anticipate how to invest in the market. While it remains to be seen how long it will take for the next bull market to arrive, it is safe to say that it is only a matter of time. When such a time arrives, a few growth stocks will be well positioned to deliver stellar wealth growth to investors.
Considering the growth potentials and industry outlooks, Aritzia stock and Alaris Equity stock can be great additions to your portfolio to leverage the next bull run.
