Many Canadian growth stocks, especially from the tech sector, have seen a spectacular rally in 2023 so far, despite continued worries about high inflation and the economic outlook.
While macroeconomic concerns might keep growth stocks volatile in the near term, I expect their rally to extend further as the ongoing cycle of interest rate hikes gradually comes to an end in the coming quarters. That’s one of the key reasons why TSX investors still have the opportunity to add their favourite fast-growing tech stocks to their portfolio today and hold for the long term.
In this article, I’ll talk about two top growth stocks in Canada that look like screaming buys right now.
Celestica stock
Celestica (TSX:CLS) is my first Canadian growth stock pick you can consider today. This Toronto-headquartered company designs and makes hardware platforms and supply chain solutions for businesses across the world. CLS is currently the top-performing TSX Composite component of 2023 with its outstanding 110% year-to-date gains, bringing its stock price to $32.10 per share with $3.8 billion in market cap.
Its share prices jumped 50.7% in July 2023 alone to mark their best monthly gains since May 2020, supported by its much stronger-than-expected second-quarter results. In the second quarter, Celestica’s revenue rose 13% year over year to US$1.9 billion with the help of the strong performance of its connectivity and cloud solutions segment. Its adjusted quarterly earnings jumped 25% from a year ago to US$0.55 per share, exceeding analysts’ estimates.
Furthermore, Celestica’s adjusted net profit margin expanded to 3.4% in the second quarter from 3.1% in the previous quarter. These solid results encouraged the company’s management to raise its 2023 financial guidance. That’s why recent gains in this Canadian growth stock can be attributed to its strong financial growth trends. I expect Celestica’s share prices to continue soaring as consistently growing demand for its cloud solutions brightens its fundamental outlook.
BlackBerry stock
With its solid 73% year-to-date gains, BlackBerry (TSX:BB) is another top Canadian growth stock you can buy in September 2023. This Waterloo-based company mainly focuses on providing cybersecurity and IoT (Internet of Things) solutions to companies globally. It currently has a market cap of $ 4.4 billion, as its stock trades at $7.59 per share.
Despite the ongoing macroeconomic challenges, BlackBerry continues to beat Street analysts’ earnings estimates quarter after quarter. In the quarter ended in May 2023, the Canadian tech firm posted an adjusted net profit of US$35 million, surprising analysts who were expecting it to report an adjusted net loss of around US$30 million. Even as the challenging economic environment has affected the cybersecurity industry globally in recent quarters, BlackBerry registered a 6% sequential increase in its cybersecurity segment revenue in the May quarter to US$93 million.
As the demand for the company’s advanced technological platforms like QNX and BlackBerry IVY is expected to grow exponentially in the coming years, you can expect BlackBerry’s financials to improve significantly. This is one of the key reasons why BB could be a great Canadian growth stock to buy on the TSX today and hold for years to come.
