Investors looking to add top growth stocks to their portfolios certainly have plenty of options to choose from. For Canadian investors, there happen to be a number of great options close to home as well as abroad. And while most investors may certainly focus most of their time and attention on U.S.-listed growth stocks, I’d argue there’s some pretty decent relative value on the TSX worth exploring.
The following two companies are among the best in the Canadian market, at least in my view. Here’s why I think these two companies are worth considering as portfolio additions in 2025 for the long term.
Kinaxis
Ottawa-based Kinaxis (TSX:KXS) is a top supply chain planning and optimization software provider. The company’s “RapidResponse” technology has become indispensable for companies looking to enhance visibility, agility, and decision-making procedures due to the growing complexity of global supply chains.
Over the past year, Kinaxis’s stock price has fluctuated within a relatively narrow band, and it’s trending toward the upper part of that band now. Accordingly, it should be no surprise to see some selling pressure start to build as investors look to rebalance their portfolios during the first few trading days of the year.
That said, over the past 12 months, Kinaxis has brought in $483 million in sales, representing an increase of more than 13% on a year-over-year basis. As the company enters new business lines, analysts and experts believe this is a company that can continue to see double-digit top- and bottom-line growth moving forward. Thus, for investors looking for a growth stock with solid fundamentals that should support a rising valuation, Kinaxis is certainly a top option to consider.
I think there are three key factors to consider when thinking about why Kinaxis may be a great long-term growth stock to hold. For one, the necessity of strong supply chain management has been highlighted by the pandemic and geopolitical unrest. This should continue in the years ahead. Secondly, the company’s recurring revenue model provides attractive and durable cash flows, which should continue to grow over time. As Kinaxis further integrates artificial intelligence and machine learning technology into its platform, these enhanced predictive capabilities should attract more clients and allow the company’s flywheel to continue spinning.
Boyd Group Services
One of the biggest collision repair service operators in North America is Boyd Group Services (TSX:BYD). The company operates under the Boyd Autobody & Glass and Gerber Collision & Glass banners in Canada and the United States, with more than 900 facilities currently under the company’s umbrella of banners.
Boyd has been a beneficiary of a number of key pandemic-related tailwinds in recent years, with its stock price surging to a new all-time high in early 2024. However, a more recent dip provides a compelling buying opportunity for long-term investors (in my view, at least), given the fact that these catalysts haven’t abated, at least not yet.
One of the key fundamental factors growth investors continue to look at when it comes to Boyd is the average age of a North American vehicle on the roads, which continues to increase. With budgets increasingly strapped, more used car purchases and a need to keep cars on the road longer should benefit large auto body chains like Boyd.
The company’s expanding network, fueled by a string of acquisitions in recent years, should continue to provide steady growth over time. And while Boyd’s recent growth has slowed to around 2% this past quarter, there are analysts out there who believe the company’s organic growth profile (as well as its growth-by-acquisition model) should spur higher growth in the coming quarters and years.
For those who believe this is the case, Boyd remains among the top economically resilient growth stocks, which I think is worth considering right now.
