Despite starting 2023 on a positive note by rising 3.7% in the first quarter, the TSX Composite Index has turned negative again lately. In July so far, the Canadian stock market benchmark has lost nearly 1.7% of its value, trimming its year-to-date gains to 2.3%, as investors remain worried about an economic slowdown amid inflationary pressures and a higher interest rate environment.
However, we shouldn’t forget that every bear market eventually turns into a bull market, which is a historically proven fact. As the macroeconomic scenario starts improving and interest rate hikes pause in the future, we can expect a spectacular market recovery. Given these recovery expectations, including some fundamentally strong growth stocks in your portfolio could be a good idea.
In this article, I’ll highlight two such perfect Canadian growth stocks you can buy in Canada right now and hold forever.
Dye & Durham stock
Dye & Durham (TSX:DND) was among the worst-affected growth stocks from 2022’s tech sector-wide selloff. After losing more than 63% of its value last year, its stock currently trades with about 17% year-to-date gains at $19.18 per share and has $1.1 billion in market cap.
This Toronto-headquartered company primarily focuses on providing cloud-based software solutions to legal and business professionals, aiming to enhance their productivity and efficiency. Based on its fiscal year 2022’s (ended in June 2022) financial figures, Dye & Durham generated more than half of its total revenue from its home market, while the remaining came from the United Kingdom and Australian markets.
In the last couple of reported quarters, Dye & Durham’s sales growth has turned negative due mainly to the ongoing economic challenges, especially related to the real estate industry. Nonetheless, in the March 2020 third quarter, it started witnessing early signs of a recovery in seasonal real estate transaction volumes, which could help it improve its financial growth in the coming quarters. This expectation of a near-term financial recovery and its strong long-term growth outlook makes DND worth considering on the dip to hold for the long term.
goeasy stock
goeasy (TSX:GSY) could be another perfect Canadian growth stock you can consider buying now. After losing nearly 41% of its value last year, this Mississauga-headquartered nonprime leasing and lending services provider currently trades with 6% year-to-date gains at $112.70 per share. Interestingly, GSY stock also offers an attractive 3.4% annualized dividend yield at this market price.
Despite the broader market challenges, goeasy’s financial growth has remained strong in recent quarters. In the March quarter, the company registered a 29% YoY (year-over-year) jump in its produced loan originations to $616 million, with a consistent strength across its entire range of products and acquisition channels. This factor helped goeasy post a 23.8% YoY increase in its revenue and a 14% increase in its adjusted quarterly earnings to $3.10 per share.
More importantly, goeasy’s balance sheet and cash flow remain robust, which can help it accelerate its financial growth further in the coming years, making its stock look attractive to hold for the long term.
