TFSA Investors: Where to Invest $6,500 This Year

Top stocks like Nuvei Corporation (TSX:NVEI) and others are the perfect target for your TFSA contribution in 2023.

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The Tax-Free Savings Account (TFSA) was launched in January 2009. At the time, the annual contribution stood at $5,000 and it was a steep hill to climb for investors to build a cash pile through capital growth or through generating dividend income. Today, the cumulative contribution room sits at $88,000. The annual contribution room was raised to $6,500 this year. Today, I want to look at three top stocks that are worth buying with that $6,500 contribution. Let’s jump in.

Can this tech stock recapture its previous magic?

Nuvei (TSX:NVEI) is a Montreal-based company that provides payment technology solutions to merchants and partners in North America, Europe, and around the world. Shares of this tech stock have dropped 15% month over month as of early morning trading on June 12. The stock is still up 13% so far in 2023. TFSA investors can see more of its recent performance with the interactive price chart below.

This company released its first-quarter (Q1) fiscal 2023 earnings on May 10. Total volume climbed 45% year over year to $42.4 billion as e-commerce represented 90% of its total volume. Revenue rose 20% to $256 million and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased to $96.3 million — up from $91.6 million in Q1 fiscal 2022.

Nuvei is still on track to deliver strong earnings going forward. Relative Strength Index (RSI) is a technical indicator that measures the price momentum of a given security. This tech stock last had an RSI of 24, putting it well into technically oversold territory. TFSA investors should be eager to jump on the dip before the midway point this June.

Here’s a growth stock that is perfect for your TFSA right now

Pet Valu (TSX:PET) is a growth stock I’d love to stash in any TFSA to kick off the summer season. This Markham-based company is engaged in the retail and wholesale of pet foods, treats, toys, apparel, and accessories across Canada. Its shares have dipped 9.4% month over month at the time of this writing. The stock is down 20% so far in 2023.

The global pet care market is geared up for strong growth over the course of this decade. Indeed, pet ownership exploded in Canada in the opening months of the pandemic. TFSA investors should jump at the chance to get into this market. In Q1 2023, Pet Valu delivered revenue growth of 17% to $250 million. Meanwhile, adjusted EBITDA jumped 4.3% year over year to $48.8 million.

Shares of this TSX stock currently possess a solid price-to-earnings ratio of 23. Pet Valu last paid out a quarterly dividend of $0.10 per share. That represents a modest 1.2% yield.

One more stock that is worth spending your TFSA contribution on today

Primo Water (TSX:PRMW) is the third stock I’d look to spend the remainder of our TFSA contribution on in the first half of June 2023. This Tampa-based company that provides pure-play water solutions for residential and commercial customers in North America. Shares of Primo Water have plunged 10% over the past month. Its stock is now down 18% in the year-to-date period.

In the first quarter of fiscal 2023, revenue rose 4% year over year to $547 million on the back of strong growth in its Water Direct/Water Exchange and Water Refill/Water Filtration segments. Moreover, adjusted EBITDA climbed 8% to $95 million. This stock is still trading in favourable value territory compared to its industry peers. It offers a quarterly dividend of $0.08 per share, which represents a 2.4% yield.

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 Ambrose O'Callaghan has positions in Nuvei. The Motley Fool has positions in and recommends Nuvei. The Motley Fool recommends Pet Valu. The Motley Fool has a disclosure policy.

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