If you follow my writing, you may know that I tend to focus on growth stocks. Like many Canadians, I’m trying to create a portfolio that creates generational wealth. Focusing on growth stocks gives Canadians an opportunity to invest in stocks that can beat the broader market by a wide margin.
In addition to investing in growth stocks, investors should look for ways to make use of tax-advantaged accounts. For example, using a Tax-Free Savings Account (TFSA), investors can avoid having to pay any additional taxes on any gains they generate. In 2024, the Canadian government added $7,000 of TFSA contribution room to eligible Canadians.
In this article, I’ll discuss three top growth stocks that you should consider investing in today.
A solid growth stock to buy today
If you’re willing to throw the entirety of this year’s TFSA contribution room into one stock, I’d suggest doing that with Constellation Software (TSX:CSU). This is a proven Canadian stock market winner. For those that aren’t familiar, Constellation Software acquires vertical market software (VMS) businesses. What makes Constellation Software such a great stock to hold is because of its solid acquisition strategy.
This company focuses on finding great businesses. It requires that a business be profitable, have above-average growth, and an exceptional management team. Upon acquisition, Constellation Software then provides the backing needed to turn these businesses into exceptional business units. Since listing on the stock market in 2006, Constellation Software stock has gained more than 20,000%. I would attribute that growth to its tremendous business performance.
This company is world renowned
Investors should also consider buying shares of Shopify (TSX:SHOP). This company has emerged from being a small tech startup in Ottawa to one of the largest players in the global e-commerce industry. Honestly, there are so few companies in Canada that have managed to impact the global market like Shopify has. That alone speaks volumes about how great this company is.
Shopify, as you may know, provides merchants of all sizes with a platform and many of the tools necessary to operate online stores. It serves more than a million merchants ranging from first-time entrepreneurs to large-cap enterprises. Shopify reported US$1.7 billion in quarterly revenue in its most recent earnings presentation (increase of 25% year over year). That suggests that the company may not be done growing any time soon. The stock has gained 81% over the past year.
A company that deserves more attention
Finally, I believe you should consider investing in Alimentation Couche-Tard (TSX:ATD). This stock may not be the most exciting business out there, but it’s proven to be very successful. Alimentation Couche-Tard operates more than 14,000 convenience stores across the world. It operates in 25 countries and territories.
Over the past year, Alimentation Couche-Tard stock has gained about 31%. Although it’s not quite as high as the growth rate of the previous two stocks mentioned here, it still outpaces the TSX by a very large margin. I also think investing in this sort of company could give you excellent diversification in your portfolio, should it already be heavily weighted in tech stocks.