If you’re planning for long-term financial goals, stocks are worth your attention. Over the years, the equity market has outperformed many other investments, especially in the long term, making it a reliable way to grow wealth. Against this background, let’s look at three stocks that are my favourite to buy right now. Notably, these Canadian stocks are backed by fundamentally strong businesses with the potential to deliver above-average returns.
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goeasy stock
goeasy (TSX: GSY) stock is one of my top picks for the long term. This Canadian subprime lender has delivered superior returns thanks to its consistent track record of solid revenue growth and profitability. Over the past five years, goeasy’s top line grew at an average annualized growth rate (CAGR) of about 20%. Meanwhile, its EPS growth rate was even higher, increasing at a CAGR of 28.1%. These strong financials have helped goeasy’s stock price soar by an incredible 229% during this period, rewarding shareholders handsomely.
Beyond capital appreciation, goeasy has also been a reliable income stock. goeasy has increased its dividend for 10 consecutive years, making it a reliable choice for investors looking for growth and recurring income.
goeasy is well-positioned for continued growth. The financial services company’s growing consumer loan portfolio, industry leadership in the non-prime lending market, geographic expansion, omnichannel offerings, and diversified funding sources will support its revenue growth. Further, steady credit performance and operating efficiency will drive its earnings, supporting both its dividend payouts and share price growth.
Celestica stock
Celestica (TSX: CLS) is one of my favourite stocks to capitalize on the booming artificial intelligence (AI) market. The manufacturing, hardware platform, and supply chain solutions provider will likely benefit from large investments in data centre infrastructure from its hyperscale customers, including very solid demand for its hardware platform solutions (HPS) offerings.
Celestica’s Connectivity & Cloud Solutions (CCS) segment, which covers communications and enterprise markets (such as servers and storage), is poised to capitalize on the increasing demand for AI and machine learning (ML) compute programs. In addition, the rising demand for its networking products, particularly 800G switches, is another positive growth driver.
Beyond AI, Celestica is seeing growth in segments like aerospace and defence, and capital equipment. Although its industrial business is currently experiencing a slowdown, there’s potential for a rebound which could significantly boost the company’s financial performance and share price.
Bombardier stock
Bombardier (TSX: BBD.B) is another favourite stock of mine for its solid growth potential. The business jet manufacturer is growing rapidly, driven by an increase in aircraft deliveries. Further, the momentum in its business will sustain, reflecting higher demand for its new lineup of medium and large business jets.
Bombardier has also diversified its business into defence, services, and the pre-owned aircraft market. This strategic expansion provides new revenue streams and enhances the company’s business stability and predictability, reducing reliance on any one segment. This diversification is expected to fuel its growth and increase profitability.
The company has been optimizing its balance sheet, improving liquidity, and lowering its debt load. These efforts leave Bombardier in a solid financial position to capitalize on growth opportunities. In summary, the company’s solid growth prospects across all business segments, improving profitability, and balance sheet strength position it well to outperform the broader markets in the coming years.
