TFSA Investors: 2 TSX Stocks for a Legit Shot at $1 Million in 20 Years

Considering their growth prospects and attractive valuations, these two TSX stocks would be an excellent buy for your TFSA.

| More on:

In 2009, the Canadian government introduced the TFSA (tax-free savings account) to encourage citizens to save more. It allows investors above 18 years to earn tax-free returns on a specified amount called contribution room. For 2023, the Canada Revenue Agency has fixed the contribution room at $6,500. Meanwhile, the cumulative amount for an investor who was 18 or above in 2009 was $88,000.

If an investor invested this amount in stocks that grow at over 13% annually, he would have over $1 million by the end of 20 years. Here are my two growth stocks, both of which have the potential to grow at a healthier rate and deliver oversized returns for years to come.

Nuvei

Nuvei (TSX:NVEI) is a financial services company that offers payment solutions to a wide range of customers globally. The company operates in over 200 markets, supporting 150 currencies and over 600 alternative payment methods. With the growing popularity of online payments amid the expansion of e-commerce, the demand for its products and services is rising. Meanwhile, Grand View Research expects the global digital payments market to grow at an annualized rate of over 20% for the rest of this decade.

Amid the expanding addressable market, Nuvei is focusing on innovative product launches, making strategic acquisitions, growing its APM (alternative payment methods) portfolio, and venturing into new markets to boost its sales. Last year, it launched 96 new products and added new APMs to increase its portfolio to 603. The company’s recent acquisition of Paya Holdings has strengthened its position in high-growth verticals across the United States. The digital payments solutions provider also expanded its product offering in Australia, thus allowing its clients to access the full suite of payment solutions.

Besides payment solutions, Nuvei has acquired licenses to service regulated online sports betting operators in several states across the United States. So, the company’s growth prospects look healthy. Meanwhile, Nuvei’s management expects its revenue to grow at an annualized rate of 20% in the medium term. Also, its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) margin could cross 50% in the long term. Despite its healthy growth prospects, NVEI stock trades at an attractive NMT (next 12 months) price-to-earnings multiple of 20.1, making it an attractive buy.  

WELL Health Technologies

WELL Health Technologies (TSX:WELL) is another stock that offers impressive long-term growth prospects as the adoption of virtual healthcare services rises. Supported by technological advancements and growing internet penetration, the telehealthcare services market is growing at a healthier rate. Meanwhile, Grand View Research projects the global telehealthcare market to grow at a CAGR of 24% through 2030.

Supported by its aggressive expansion, strategic investments, and development of innovative products, WELL Health is well-positioned to benefit from market expansion. Its recent acquisitions have strengthened its position in Canada and expanded its presence in the United States. Last month, the company made a strategic investment in a German-based medical practice management software company, doctorly GmbH. The investment could aid WELL Health in expanding its footprint in Germany and later across Europe.

Despite its high-growth prospects, WELL Health trades at an attractive NTM price-to-sales and NTM price-to-earnings multiples of 1.7 and 16.5, respectively. So, considering its growth prospects and attractive valuation, I believe WELL Health would be a worthy buy for long-term investors.

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 Rajiv Nanjapla has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nuvei. The Motley Fool has a disclosure policy.

More on Tech Stocks

woman looks at iPhone
Tech Stocks

Shopify, Lightspeed, and WELL Health: Are They Good Buys Today?

While broader markets have rallied, Shopify, Lightspeed, and WELL Health stocks haven't followed suit, showing weaker performance.

Read more »

A robotic hand interacting with a visual AI touchscreen display.
Tech Stocks

2 Canadian Stocks That Could Turn $10,000 Into $100,000

If there are two Canadian stocks worth the investment, it has to be these two offering up decades of growth.

Read more »

coins jump into piggy bank
Tech Stocks

The Smartest Way to Invest $7,000 in Your TFSA This Year

Investing in small-cap TSX stocks such as DTOL should help TFSA holders deliver outsized gains in 2025 and beyond.

Read more »

dividends can compound over time
Tech Stocks

The Smartest Growth Stocks to Buy With $1,000 Right Now

Have $1,000 to invest for growth? These three Canadian stocks could still have a long runway to grow sales and…

Read more »

match strikes and starts a flame
Tech Stocks

2 Explosive Stocks That Could Go Parabolic

As the TSX rallies, these two explosive stocks are showing no signs of slowing down, backed by solid fundamentals and…

Read more »

Blocks conceptualizing Canada's Tax Free Savings Account
Tech Stocks

The $28,000 TFSA Strategy That Balances Growth and Security

A $28,000 TFSA strategy must have stock holdings that balance growth and security.

Read more »

dividend growth for passive income
Tech Stocks

The Best TSX Stocks to Buy for a Decade or More of Growth

The recent market correction has created opportunities to buy high-quality TSX stocks at attractive valuations. Here are three to look…

Read more »

online shopping
Tech Stocks

Best Stock to Buy Right Now: Shopify vs Lightspeed?

One has a proven track record while the other offers a speculative opportunity for triple-digit gains. But the Shopify vs.…

Read more »