Investing any large sum of money into the stock market can initially make many investors dizzy. However, as most investors know, building a million-dollar retirement portfolio can create the kind of economic security in one’s golden years that’s worth considering.
For most, having at least six figures of capital set aside to invest in a well-diversified portfolio to create a seven-figure portfolio is a great start. The good news is that many folks in their forties are in such a position but may be looking to amplify the growth within their portfolios to achieve millionaire status.
For those in such a position, here are three top growth stocks I think shouldn’t be overlooked right now. These companies have the potential to create life-changing portfolio returns and look like solid opportunities at current levels.
Shopify
Shopify (TSX: SHOP) is one of the largest e-commerce giants in the world. The Canada-based giant continues to be among the most valuable companies on the TSX, and it is known for its platform, which allows businesses of all sizes to set up online shops and enhance their overall business models.
As investors will note from the chart above, Shopify saw an incredible surge following the pandemic and the rising demand for e-commerce offerings. While that growth has since waned, Shopify continues to grow its top line at more than 20%, with its earnings also surging in recent years as the company has pursued a number of key efficiency initiatives.
For those bullish on the long-term secular growth trends underpinning the e-commerce sector, Shopify remains a top pick of mine in the growth space. On a forward basis, this stock isn’t cheap at 58 times earnings. However, if the company can see its growth rate accelerate from here, Shopify could turn out to be a steal in the long run.
Constellation Software
Constellation Software (TSX: CSU) stands out as a dominant Canadian player in the software space. The company manages and acquires vertical market software firms and has done so for decades using a growth-by-acquisition strategy. Constellation focuses on acquiring small- to mid-sized companies operating in the software space and scaling them up with a methodology that proves to be very successful with time.
Initially listed in 2006, Constellation Software has seen its share price surge more than 22,000% since inception. With a solid business model, the company continues to appeal to growth investors, with a valuation multiple that speaks to this trend.
For those looking to create long-term wealth, I’d invite investors to consider the long-term chart of this particular company. Nothing has changed in terms of Constellation’s core business model. So, for those looking to take advantage of a long runway for growth in the software consolidation trend, CSU stock remains a top pick of mine for those looking to buy and hold a growth stock for the next decade or longer.
Boyd Group
Boyd Group (TSX: BYD) is one of the biggest automotive companies in Canada, operating under the name Boyd Autobody & Glass and Assured Automotive. It is one of North America’s largest non-franchised collision repair centre operators and a significant retail auto glass operator within the U.S.
Boyd Group has seen strong cash flow growth in recent years, which I believe leads to a growth stock that’s relatively undervalued. The company’s net income has dipped this past quarter on a year-over-year basis. However, analysts project that Boyd’s net earnings could grow at a nearly 50% rate over the coming years, creating a stock that’s fundamentally fairly or potentially undervalued in this current climate.
In my view, this is another consolidation play that’s worthy of attention. The auto body space remains highly fragmented, with plenty of opportunity for Boyd to continue to roll smaller and mid-sized chains into its portfolio.
