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.

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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

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