Holding quality growth stocks in a TFSA (Tax-Free Savings Account) is a good strategy for Canadian investors. Any returns derived in this registered account are exempt from taxes, allowing individuals and households to benefit from tax-free gains over time.
While you can hold various qualified investments in the TFSA, it makes sense to buy growth stocks poised to deliver market-beating returns in the upcoming decade. Here are three such TSX stocks you can buy and hold for the long run.
Propel Holdings stock
Valued at a market cap of $1 billion, Propel Holdings (TSX:PRL) is a fintech company that went public two years back. It operates an online lending platform that facilitates access to credit products such as installment loans and lines of credit. Since its IPO (initial public offering), Propel Holdings has returned over 160% but continues to trade at a cheap valuation.
In Q2 2024, Propel generated over $100 million in quarterly sales for the first time, as total originations grew 40% to $144 million. Propel emphasized that its ability to expand credit access while maintaining strong credit performance is attributable to its artificial intelligence (AI) capabilities. Higher-than-expected consumer loans allowed Propel to report an adjusted net income of $15.6 million in the June quarter.
Analysts expect the TSX stock to increase adjusted earnings from $1.35 per share in 2023 to $3.13 per share in 2025. So, priced at nine times forward earnings, Propel should deliver outsized gains to long-term shareholders.
Dollarama stock
Valued at $38.5 billion by market cap, Dollarama (TSX:DOL) is among the largest companies in Canada. It operates a chain of dollar stores in Canada, offering general merchandise, consumables, and seasonal products.
Despite a sluggish macro environment, Dollarama increased its sales by 8.6% year over year in fiscal Q1 of 2025 (ended in April) to $1.4 billion due to higher demand for core consumables and everyday essentials. In the April quarter, Dollarama’s gross margin stood at 43.3%, an increase of 100 basis points year over year due to the positive impact of renewed shipping contracts and lower logistics expenses.
According to Dollarama, demand for general merchandise and seasonal products has remained stable as customers deploy their discretionary spending prudently. Moreover, Dollarama opened 18 net new stores in the quarter, bringing its total store count to 1,569.
Eldorado Gold stock
The final TSX stock on my list is Eldorado Gold (TSX:ELD), which is engaged in the mining, exploration, development, and sale of mineral products in Turkey, Canada, Greece, and Romania. It produces commodities such as gold, silver, lead, and zinc.
Gold prices are trading near all-time highs due to the possibility of lower interest rates, geopolitical tensions, and a challenging macro environment. Higher gold prices allowed Eldorado to increase its operating cash flow to US$132 million in Q2 2024, up from US$82 million in the year-ago period. Its total cash costs totaled US$940 per ounce while all-in-sustaining costs were US$1,331 per ounce, which were higher year over year due to rising labour costs and royalty expenses.
Priced at 11 times forward earnings, ELD stock is cheap and trades at a 22% discount to consensus price target estimates.
