If you are considering investing $10,000 in stocks, focus on fundamentally strong companies. These are businesses with solid financials and growth potential that can help you achieve higher-than-average returns over time. Another key strategy is to diversify your investment across multiple sectors, which will help lower overall portfolio risk. Against this background, let’s look at the best Canadian stocks to buy right now.
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goeasy stock
goeasy (TSX: GSY) is a compelling stock to buy now for its high growth, attractive valuation, and solid dividend payments. The company consistently grows its revenue and profit at a solid double-digit rate. Thanks to its solid financials, shares of this subprime lender have gained over 66% in one year and 275% in five years. In addition, goeasy consistently increased its dividend over the past 10 years.
The financial services company will likely grow its top and bottom lines at a double-digit rate, driven by its leadership in Canada’s subprime lending market, geographical expansion, and diverse funding sources. Moreover, stable credit performance and operating leverage will cushion its earnings, dividend payments, and share price.
Further, goeasy stock is trading at the next 12-month price-to-earnings multiple is 9.7, which is considerably low considering its average earnings per share growth rate of over 28% and a dividend yield of 2.5%.
TerraVest Industries stock
Investors could consider TerraVest Industries (TSX: TVK) stock. The company makes home heating products, energy processing equipment, propane, anhydrous ammonia, fibreglass tanks, and natural gas transport vehicles.
Thanks to its wide offerings and solid demand for its products, TerraVest stock has gained more than 160% over the past year. Moreover, it is up about 309% in three years.
Despite the notable rally in its shares, TerraVest is poised to deliver massive gains in the coming years as it expands its product lines in high-growth markets and improves manufacturing capabilities. Further, its solid balance sheet and strategic acquisitions will likely accelerate its growth rate. TVK also enhances its shareholder value through dividend payouts.
Dollarama stock
Dollarama (TSX: DOL) is a top TSX stock offering a compelling combination of stability, income, and growth. This discount store operator is known for its resilient business model and ability to grow sales and earnings in all market conditions. The retailer sells a variety of products at low price points, appealing to a wide range of customers. This strategy consistently drives its revenue and earnings, increasing its share price and supporting its dividend payments.
Dollarama stock has increased about 41% over the past year. The uptrend in its shares will likely be sustained, driven by consistent sales and earnings growth led by value pricing, a defensive business model, an extensive store base, and productivity savings. Further, the company will continue to enhance its shareholders’ value through higher dividend payments.
Aritzia
Clothing retailer Aritzia (TSX: ATZ) is poised to outperform the TSX over the next decade. The company’s revenue and net income have grown at an average annualized rate of 19% and 13%, respectively, in the last five years. This trend will continue driving its share price higher.
Aritzia’s focus on introducing new styles, expanding boutiques in high-growth areas, and expanding omnichannel offerings will drive its top line. Further, supply-chain improvement and cost-savings measures will cushion its earnings and support its share price.
Aritzia’s revenue is forecasted to grow by 15-17% annually through fiscal 2027. Leverage from higher sales and operating leverage will help the company grow its earnings faster than revenue.
