The Canadian market is filled with plenty of high-quality stocks that can grow your money rapidly and consistently for years. In just the last decade there are numerous stocks that have grown at a compounded annual growth rate (CAGR) of more than 20%.
Many of these can continue to grow at an impressive rate, and there are new companies, such as Shopify, that are less than a decade old and have shown they can grow quickly and consistently as they build out e-commerce.
It’s one thing to buy a stock that can gain significant value for a year or two. These stocks can still grow your capital substantially.
However, it’s the companies that can consistently grow your capital at a faster pace than the market that are the best of the best investments. And the longer they can keep up their impressive growth, the more investors can take advantage of the power of compounding.
So, with that in mind, if you’re looking for high-potential Canadian stocks to buy now and hold for years, here are three of the best to consider.
One of the best defensive growth stocks that Canadian investors can buy
For years, Dollarama (TSX:DOL) has been one of the most impressive Canadian stocks. But after the last two years, when many companies have struggled and the economy has faced such severe headwinds, Dollarama’s impressive performance has certainly stood out.
Last year, for example, Dollarama stock saw its revenue jump by a whopping 16.7%. That’s a massive jump for a large-cap retail stock with a market cap of more than $25 billion. Plus, this year, analysts are predicting that Dollarama will once again see significant revenue growth of more than 15%.
This just goes to show how defensive Dollarama is, in addition to what a high-quality growth stock it is. Over the last decade, for example, it’s earned investors a total return of 612%. That’s a CAGR of more than 21.5% for one of the best Canadian stocks you can buy.
A rapidly growing financial stock
In addition to Dollarama, another one of the best Canadian stocks you can buy now and hold for years is goeasy (TSX:GSY).
Over the last decade, goeasy is up a whopping 1,134%. That’s a CAGR of more than 28.5% as it rapidly expanded its loan book.
What’s most impressive about goeasy, though, is that while it primarily offers credit to consumers with below prime credit scores, as it continues to rapidly expand its loan book, it’s managed to keep its charge-off rates manageable.
This consistent ability to manage risk is a key reason goeasy has been able to see such significant growth in its revenue, but even more so in its profitability.
For example, over the last three years, it’s increased its revenue by over 67%. However, even more impressive is that during that stretch, goeasy’s normalized earnings per share jumped by an unbelievable 123%.
Furthermore, for the full 2023 year, analysts are expecting revenue growth of more than 26%, with another 25% increase expected in 2024.
A top growth by acquisition stock
Last but not least on the list is Alimentation Couche-Tard (TSX:ATD), another one of the best Canadian stocks that also has an impressive track record of rapid but, more importantly, consistent growth.
In the last decade, Couche-Tard has earned investors a total return of over 520%. That’s a CAGR of exactly 20%.
Couche-Tard has done this by making a series of high-quality, value-accretive acquisitions, as it expands its defensive business operations all over the world. Furthermore, it’s also increased its focus on generating organic growth as well.
Therefore, it’s no surprise that investors expect Couche-Tard to grow its revenue by another 12% next year. It’s also no surprise that of the 11 analysts covering Couche-Tard, all 11 give the stock a buy rating.
So, if you’re looking for top Canadian stocks to buy now that can grow your capital significantly, Couche-Tard is certainly one of the best there is.
