Investors planning to invest their savings for long-term financial goals should look for fundamentally strong stocks that have the potential to consistently outperform the broader markets. This will enable them to create significant wealth over the years and retire rich.
Against this backdrop, here are three Canadian stocks that have outshined the broader markets with their returns and have the potential to make you rich by retirement.
Shopify
Shopify (TSX:SHOP), without a doubt, is one of the best stocks to create wealth and retire rich. Investors should note that Shopify has gained about 462% in five years, reflecting a five-year compound annual growth rate (CAGR) of over 41%. While Shopify stock has delivered noteworthy returns, it remains well positioned to capitalize on the digital shift and deliver solid gains.
Shopify stock has witnessed a stellar recovery in 2023. This underscores its resilience in generating substantial revenue, even in challenging macroeconomic conditions and at scale. Further, this tech giant’s commitment towards innovation, growing adoption of its products, the addition of new features for merchants, and the expansion of sales and marketing channels indicate that Shopify is poised to generate impressive transaction volumes and expand its merchant base, thereby supporting its overall revenue growth.
Furthermore, Shopify’s implementation of cost-cutting measures and its emphasis on an asset-light business model will fortify its profit margins, allowing the technology company to consistently generate sustainable earnings. Overall, Shopify’s dominant positioning in the e-commerce space, durable revenue growth, and focus on delivering profitable growth suggest it has solid upside potential in the long term.
Alimentation Couche-Tard
Alimentation Couche-Tard (TSX:ATD) stock could be another solid addition to your investment portfolio. The stock offers an attractive combination of high growth, stability, and income. It is noteworthy that Couche-Tard stock has grown over 135% in the last five years, reflecting a CAGR of nearly 19%. This outperformance is backed by its strong financial performance. For instance, Couche-Tard’s top and bottom lines sport a 10-year CAGR of 7.3% and 18.8%, respectively.
Alimentation Couche-Tard’s focus on strategic acquisitions has helped it expand its store network and drive traffic, thus supporting its top- and bottom-line growth. Meanwhile, the company has regularly repurchased shares and increased dividend payments, boosting its shareholders’ value.
Looking ahead, Alimentation Couche-Tard’s significant scale, extensive store base, cost discipline, and growing private label offering will support its revenue and profitability. Moreover, its ability to acquire and integrate companies will likely accelerate its growth rate and position the company to generate significant returns.
goeasy
Shares of the subprime lender goeasy (TSX:GSY) are a must-have in a long-term portfolio. goeasy stock has generated significant returns and made its investors rich. For instance, goeasy stock has grown at a CAGR of over 40% in the past five years, delivering an impressive return of about 445%. This growth is backed by its robust financials, which are growing at a double-digit rate.
For instance, goeasy’s revenue and earnings per share have grown at a CAGR of 19.6% and 31.9%, respectively, in the last five years. Moreover, this Dividend Aristocrat has enhanced its shareholders’ returns through higher dividend payments during the same period.
goeasy is poised to capitalize on the large subprime lending market. Further, the company’s growing loan portfolio, steady credit performance, and improved operating efficiency will continue to cushion its top and bottom lines, support higher dividend payments, and push its stock price higher.
