Last year, the Canadian government announced that the annual contribution to a Tax-Free Savings Account (TFSA) would increase to $6,500. That brings the cumulative contribution room in a TFSA to $88,000. Today, I want to zero in on four stocks that have the potential for huge long-term growth. These are perfect equities to target in a TFSA.
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Here’s why goeasy is perfect for your TFSA in 2023 and beyond
goeasy (TSX:GSY) is a Mississauga-based company that provides non-prime leasing and lending services under the easyhome, easyfinancial, and LendCare brands to Canadian consumers. Shares of this TSX stock have dropped 7.2% in 2023 as of close on March 28. The stock is now down 30% in the year-over-year period.
This company released its fourth-quarter (Q4) and full-year fiscal 2022 earnings on February 15, 2023. For the full year, goeasy posted adjusted annual diluted earnings per share (EPS) of $11.55 — up 11% from the previous year. Meanwhile, loan originations surged 49% to $2.38 billion. The company projects that its gross consumer loans receivable could reach between $4.7 billion and $5.0 billion by the end of fiscal 2025.
Shares of goeasy currently possess a favourable price-to-earnings (P/E) ratio of 11. It recently hiked its annual dividend per share by 5.5% to $3.84. goeasy is a Dividend Aristocrat that has delivered nine straight years of income growth. That makes goeasy perfect for your TFSA.
I’m bullish on Pet Valu for the future; here’s why…
Pet ownership experienced huge growth over the course of the COVID-19 pandemic. Human beings were starved for affection during the lockdown phase, which undoubtedly sparked the urge to add a furry friend to their home — or something with feathers or scales, if that’s your thing. Predictably, spending on pet products has also soared. That is great news for Pet Valu (TSX:PET), a Markham-based company engaged in the retail and wholesale of pet foods, treats, toys, apparel, and accessories.
This stock has declined 8.3% in 2023. However, its shares are still up 11% in the year-over-year period.
In fiscal 2022, Pet Valu posted system-wide sales growth of 29% to $1.29 billion. Meanwhile, it delivered adjusted net income of $114 million, or $1.59 per diluted share — up 57% and 55%, respectively, compared to fiscal 2021. Shares of Pet Valu possess a solid P/E ratio of 25. It offers a quarterly dividend of $0.10 per share, which represents a modest 1.1% yield. Pet Valu is a terrific target for TFSA investors on the hunt for growth.
Don’t sleep on this stock that has promising long-term potential
Jamieson Wellness (TSX:JWEL) is a Toronto-based company that develops, manufactures, distributes, markets, and sells natural health products in North America and around the world. This market is geared up for strong global growth, bolstered by a health-conscious, aging population. Its shares have dipped 6.6% in 2023. Fortunately, it is not too late to buy the dip for TFSA investors.
The company delivered revenue growth of 21% to $547 million in fiscal 2022. Meanwhile, adjusted net earnings jumped 18% to $65.1 million. Jamieson stock last had a P/E ratio of 26, putting it in more favourable value territory compared to its industry peers. It offers a quarterly dividend of $0.17 per share, representing a 2% yield.
One more enticing stock to add to your TFSA in late March
Kinaxis (TSX:KXS) is the fourth and final stock I’d target for our hypothetical TFSA today. This Ottawa-based company provides cloud-based subscription software for supply chain operations in Canada, the United States, and around the world. Shares of this tech stock has surged 16% so far in 2023.
In Q4 2022, Kinaxis delivered total revenue growth of 44% to $98.4 million. Meanwhile, gross profit jumped 40% to $61.2 million. For the full year, Kinaxis saw revenue increase 46% year over year to $366 million. The company is projecting total revenue between $420 million and $430 million in fiscal 2023 and Software as a Service growth between 25% and 27%.
This tech stock is trading in solid value territory compared to its industry peers. TFSA investors should feel good about seeking exposure to the supply chain management software space, especially in a global leader like Kinaxis.
