Canadian investors who are just starting out with a self-directed portfolio will want to lay out their own risk tolerance and long-term goals before they purchase a share in anything. Today, I want to discuss why new investors should explore a growth-oriented strategy in 2023 and 2023. Moreover, I want to zero in on two of my favourite growth stocks as we approach the midway point of September. Let’s jump in.
Here’s why new investors should seek out growth as they start their investment journey
Typically, a new investor will be a young investor with a long time horizon. Canadians who have an investment window of over a quarter century should be much more willing to incur risk to gobble up big gains. However, Canadians who are nearing retirement and/or possess an investment window closer to five years or less should mitigate risk in their portfolios.
In this piece, we are going to move forward as new investors with a timeline in the 30-40 years range. That means we are going to embrace risk and pursue a growth-oriented investment strategy.
This is the first growth stock I’d target in September 2023
Cargojet (TSX:CJT) is a Mississauga-based company that provides time-sensitive overnight or air cargo services across Canada. Shares of this growth stock have increased 3.9% month over month as of close on Friday, September 8. Meanwhile, Cargojet stock is still down 16% so far in 2023.
New investors should be intrigued by the potential of this market. The market research firm The Insight Partners recently valued the global air cargo market at US$123 billion in 2022. That same report projected that the market would grow to US$175 billion by 2028. That would represent a compound annual growth rate (CAGR) of 5.9% over the forecast period.
This company released its second-quarter (Q2) fiscal 2023 earnings on August 14. Cargojet reported total revenues of $209 million in Q2 2023 — down from $246 million in the prior year. Meanwhile, adjusted free cash flow improved to $52.3 million compared to $41.2 million in Q2 2022. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) fell to $74.3 million over $81.1 million in the previous year.
Shares of Cargojet currently possess a favourable price-to-earnings (P/E) ratio of 11. Moreover, the stock offers a quarterly dividend of $0.286 per share. That represents a modest 1.1% yield. Cargojet is also on track for strong revenue growth going forward.
The explosion of telehealth should power this exciting growth stock
WELL Health Technologies (TSX:WELL) is the second growth stock I’d suggest for new investors in the first half of September 2023. This practitioner-focused digital health company is based in Vancouver and operates in Canada, the United States, and around the world. Its shares have jumped 4.6% over the past month. The stock has soared 60% in the year-to-date period. New investors can see more of its recent and past performances with the interactive price chart below.
In Q2 2023, WELL Health reported record quarterly revenues of $170 million. That represented 18 consecutive quarters of record revenues for the company. Meanwhile, adjusted EBITDA also rose to a record $27.8 million. The company hit over one million patient visits for the first time in Q2 2023 and nearly hit 1.5 million total patient interactions. WELL Health is geared up for huge growth going forward.
This growth stock is trading in attractive value territory compared to its industry peers at the time of this writing. New investors cannot ignore the potential of the telehealth space in the 2020s and beyond. It is not too late to snatch up this growth stock for a solid price.