The S&P/TSX Composite Index climbed 188 points on Wednesday, August 23. This triple-digit gain offered some respite from a rough stretch that the Canadian market has suffered in the second half of August. Despite the choppy environment, there are still many terrific growth stocks available to Canadians right now. Today, I want to target three growth stocks that have the potential to make you a fortune by the end of this decade. Let’s jump in.
Canadians should bet big on the pet industry in the 2020s
Pet Valu (TSX: PET) is a Markham-based company that is engaged in the retail and wholesale of pet foods, treats, toys, apparel, and accessories in Canada. Shares of this growth stock have plunged 13% month over month as of close on Wednesday, August 23. Meanwhile, Pet Valu stock has now dropped 33% so far in 2023.
Despite the recent turbulence, I’m still very bullish on Pet Valu’s medium- and long-term prospects. The pet food and accessories market is geared up for very strong growth. Pet ownership shot up during the pandemic, which has fueled pet food and accessories purchases in the first half of the 2020s.
This company released its second-quarter (Q2) fiscal 2023 earnings on August 8. Pet Valu delivered system-wide sales of $343 million — up 10% compared to the previous year. Meanwhile, it posted revenue growth of 12% to $256 million. EBITDA stands for earnings before interest, taxes, depreciation, and amortization. The measure aims to give a clearer picture of a company’s profitability. Pet Valu delivered adjusted EBITDA growth of 3.9% to $53.8 million in Q2 2023.
Shares of this growth stock currently possess a favourable price-to-earnings (P/E) ratio of 19. Pet Valu is undervalued and geared up for big growth going forward. I’m looking to buy the dip in the late summer season.
This growth stock offers exposure to the factory automation space
ATS (TSX: ATS) is a Cambridge-based company that designs and builds factory automation systems for its growing client base. This growth stock has dropped 7.8% over the past month. Meanwhile, its shares have still climbed 33% in the year-to-date period at the time of this writing.
Earlier this year, Spherical Insights valued the global industrial automation market at US$177 billion in 2021. The same report projected that this market would deliver a compound annual growth rate (CAGR) of 8.8% through 2030, reaching a valuation of US$441 billion.
Investors got to see ATS’s Q1 fiscal 2024 earnings on August 9. The company achieved revenue growth of 23% to $753 million. Meanwhile, adjusted basic earnings per share (EPS) rose to $0.69 compared to $0.57 in the prior year. ATS’s Order Backlog increased 30% to $2.02 billion.
One more growth stock Canadians should target today
Nuvei (TSX: NVEI) is the third and final growth stock I’d suggest Canadians snatch up in late August 2023. This Montreal-based company provides payment technology solutions to merchants and partners in North America, Europe, and around the world. Shares of this tech growth stock have plunged 34% so far in 2023.
The recent turbulence should not dissuade growth-oriented investors. Nuvei is a stock with promising growth potential in the burgeoning payment technology solutions market. In Q2 2023, the company posted total volume growth of 68% to $50.6 billion. Meanwhile, it delivered revenue growth of 45% to $307 million and adjusted EBITDA climbed 19% to $110 million.
This growth stock also offers a quarterly cash dividend of $0.10 per share. That represents a 2.3% yield.
