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

TSX stocks trading at a discount such as Shopify can help you outpace the broader markets in 2023 and beyond.

funds, money, nest egg

Image source: Getty Images

Stocks that have the potential to generate 1,000% in returns over two decades are considered millionaire-maker companies. In the last 20 years, several tech stocks, including Amazon, Apple, and Microsoft, have returned over 1,000% to investors, easily crushing broader market returns.

These tech behemoths increased sales and profit margins consistently due to a lower cost of debt and the multi-year bull run. While investors remain worried over a volatile stock market in 2023, the pullback in stocks across sectors allows you the opportunity to go bottom-fishing and buy shares at a bargain.

Further, if Canadians hold these undervalued gems in a TFSA (Tax-Free Savings Account), any returns generated in this registered account will be exempted from Canada Revenue Agency taxes.

Here are two such TSX stocks that TFSA investors can buy right now for a legit shot at $1 million in 20 years.

Neighbourly Pharmacy stock

A company operating in the recession-resistant healthcare sector, Neighbourly Pharmacy (TSX:NBLY) is valued at a market cap of $1 billion. Over the last few years, Neighbourly Pharmacy has grown at an accelerated pace. The company has increased sales from $186 million in fiscal 2020 (ended in March) to $671 million in the last 12 months.

Neighbourly Pharmacy continues to expand aggressively via accretive acquisitions and added six new retail locations in the December quarter. Armed with an active acquisition pipeline, it is well poised to end fiscal 2024 with sales of $954 million, according to consensus estimates.

There are more than 6,500 independently owned pharmacies in Canada. Neighbourly’s vast size allows it to acquire outlets in smaller and underserved communities.

A rapid expansion in the top line will allow the company to improve its earnings per share to $0.76 in fiscal 2024, compared to a loss of $2.57 per share in fiscal 2022.

Priced at one time forward sales and 30 times forward earnings, NBLY stock is reasonably valued, given its robust growth estimates.

Analysts remain bullish on NBLY stock and expect shares to gain another 30% in the next 12 months.

Shopify stock

Another high-growth TSX stock you can consider buying right now is Shopify (TSX:SHOP). The TSX tech stock has already returned close to 2,000% to shareholders since its initial public offering eight years back. However, due to a challenging macro-environment, SHOP stock is also trading 71% below all-time highs.

Shopify is the second largest e-commerce player in the United States after Amazon, providing it with a wide economic moat. The Canadian company has onboarded more than two million merchants to its platform to date with its widening portfolio of products and services.

Similar to most other tech stocks, Shopify reinvests its profits to expand its product pipeline. For instance, Shopify has allocated billions of dollars to build a network of fulfillment centers and help optimize the supply chain for its merchant base.

Priced at 8.1 times forward sales, Shopify stock is expensive. Despite an uncertain macro environment, Shopify stock is forecast to increase its adjusted earnings from $0.05 per share in 2022 to $0.26 per share in fiscal 2024.

Analysts tracking Shopify stock expect shares to gain over 30% in the next 12 months.

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.

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends, Apple, and Microsoft. The Motley Fool has a disclosure policy

More on Tech Stocks

A colourful firework display
Tech Stocks

3 TFSA Stock Picks With Explosive Potential

Want some explosive growth in your TFSA. These small-cap stocks have risks, but they could also have some massive reward.

Read more »

Road signs rerouting traffic
Tech Stocks

Forget Nvidia Stock: 2 Tech Stocks to Buy Instead

There are clear winners, and then there are popular choices. And Nvidia stock (NASDAQ:NVDA) has erred towards simply popular.

Read more »

stock research, analyze data
Tech Stocks

Lightspeed Stock: Should Investors Buy or Sell Before Earnings?

Lightspeed (TSX:LSPD) stock has gone through a lot the last few years, but could things be turning around come earnings?

Read more »

Technology, internet and networking, security concept
Tech Stocks

Down 45%, Is BlackBerry Stock Fairly Valued?

BlackBerry stock (TSX:BB) looks like it could be a good buy at these share prices, but it still has a…

Read more »

Upwards momentum
Tech Stocks

Don’t Overlook Shopify Stock’s HUGE Analyst Upgrade

Shopify (TSX:SHOP) stock could be ready to run as it wins the love of various analysts on Bay and Wall…

Read more »

Concept of big data flow, analysis, and visualizing complex information for artificial intelligence
Tech Stocks

Attention, TFSA Investors: These 2 AI Stocks Look Dirt-Cheap

Constellation Software (TSX:CSU) and another AI stock are looking way too cheap to ignore any longer.

Read more »

A chip in a circuit board says "AI"
Tech Stocks

3 Canadian Tech Companies Ready to Ride the AI Train

Some business models and technologies are naturally more receptive to AI transformation than others and, consequently, are ready for AI-fueled…

Read more »

Circuit board with a microchips
Tech Stocks

3 Promising AI Stocks That Are Cheaper Than Nvidia

Nvidia is positioned to outpace the broader markets in the future. But these three AI stocks may have higher upside…

Read more »