These 3 Canadian Stocks Could Triple in 5 Years

These three Canadian stocks are in a prime position for future growth. But some patience may be needed along the way.

| More on:
dividends grow over time

Source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Investing in Canadian stocks with the potential to triple in value over five years is an enticing proposition. However, identifying such opportunities requires a blend of research, market insight, and a clear understanding of the underlying risks.

Canadian stocks Ballard Power Systems (TSX:BLDP), WELL Health Technologies (TSX:WELL), and Element Fleet Management (TSX:EFN) are solid choices, each with unique strengths and potential that make them worth considering for long-term growth. Here’s what to weigh when exploring these opportunities and why these stocks stand out.

Created with Highcharts 11.4.3Ballard Power Systems + Well Health Technologies + Element Fleet Management PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

First, consider the industry trends. Canadian stocks that multiply in value often belong to sectors experiencing rapid innovation or expansion. For instance, renewable energy and digital health are booming due to global climate goals and the ongoing shift toward technology-driven healthcare. Fleet management also benefits from digitization and the transition to electric vehicles. These broader trends provide fertile ground for the companies driving innovation in these areas.

Ballard Power is a prime example of a stock tied to a transformative trend. Specializing in hydrogen fuel cell technology, Ballard aims to be a leader in clean energy solutions for vehicles and other applications. Despite its struggles, including a 45.5% decline in quarterly revenue year-over-year as of Q3 2024, the company has significant cash reserves of $637.2 million, thus providing a buffer to navigate challenges. The decline in its operating margin of 318.1% highlights current inefficiencies. Yet Ballard’s focus on expanding partnerships and improving its product line positions it for long-term growth as hydrogen adoption accelerates globally.

Finances

Next, look at financial resilience and operational efficiency. WELL Health represents a compelling case in digital health innovation. WELL reported robust 23.1% year-over-year growth in quarterly revenue as of Q3 2024, reaching $957.7 million over the trailing 12 months. It holds a profit margin of 7.7% and operating cash flow of $126.8 million. Therefore, the Canadian stock is not only growing but doing so profitably. WELL’s aggressive expansion through acquisitions and its ability to integrate digital health platforms make it a front-runner in a fast-growing sector, thus making it a likely candidate to reward patient investors.

Element Fleet Management (EFN) operates in the logistics and fleet management space, an area gaining traction as businesses digitize and shift toward sustainable transportation. EFN’s profitability is noteworthy, with a 23.4% profit margin and a return on equity of 12.6% as of Q3 2024. Its revenue has grown 9.3% year-over-year, supported by robust partnerships and a clear strategy for managing its $8.5 billion debt. The Canadian stock’s ability to leverage its financial strength while expanding its market reach underpins its potential to deliver significant returns.

Value, with risks

Another key factor is valuation and market sentiment. Stocks like BLDP, WELL, and EFN are trading at valuations that could reflect transitional phases. Ballard’s price-to-book ratio of 0.68 suggests it is undervalued relative to its assets, offering a speculative opportunity for growth investors. WELL Health trades at a forward price-to-earnings (P/E) ratio of 21.3, reflecting optimism about its future earnings. Meanwhile, EFN’s forward P/E of 16 indicates a balance of growth potential and reasonable pricing.

Yet understanding the risks is equally important. Ballard’s reliance on hydrogen technology, which is still gaining traction, means investors need a high-risk tolerance. WELL Health operates in a fragmented market where competition is fierce. And maintaining its growth trajectory will require strategic precision. EFN’s high debt-to-equity ratio, while manageable given its cash flow, is a point of caution in a rising interest rate environment.

Foolish takeaway

The outlook for these stocks hinges on the ability to execute long-term strategies. Ballard’s investments in research and development (R&D) and partnerships with global automakers could pay off as hydrogen infrastructure develops. WELL Health is well-poised to ride the digital healthcare wave, driven by both organic growth and acquisitions. Element Fleet Management’s expansion into electric fleet management aligns with environmental goals, offering it a competitive edge.

No matter what, patience and perspective are vital. Canadian stocks that triple in five years often face significant volatility along the way. By focusing on Canadian stocks with strong fundamentals and clear growth paths, investors can position themselves to benefit from long-term success. BLDP, WELL, and EFN exemplify how different industries and strategies can offer lucrative opportunities for those willing to embrace both the risks and rewards.

Should you invest $1,000 in Fortis right now?

Before you buy stock in Fortis, consider this:

The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Fortis wasn’t one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $20,697.16!*

Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 29 percentage points since 2013*.

See the Top Stocks * Returns as of 3/20/25

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Confidently Navigate Market Volatility: Claim Your Free Report!

Feeling uneasy about the ups and downs of the stock market lately? You’re not alone. At The Motley Fool Canada, we get it — and we’re here to help. We’ve crafted an essential guide designed to help you through these uncertain times: "5-Step Checklist: How to Prepare Your Portfolio for Volatility."

Don't miss out on this opportunity for peace of mind. Just click below to learn how to receive your complimentary report today!

Get Our Free Report Today

More on Dividend Stocks

grow money, wealth build
Dividend Stocks

Why I’d Invest $10,000 in This Undervalued Dividend-Growth Stock for Decades of Income

This undervalued dividend stock offers a high yield of over 8% and can help you earn more than $200 in…

Read more »

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Dividend Stocks

Here’s Exactly How a $20,000 TFSA Could Potentially Grow to $200,000

Index funds like the iShares S&P/TSX Capped Composite Index (TSX:XIC) are tax free in a TFSA.

Read more »

Dividend Stocks

How I’d Invest $6,000 in Canadian Real Estate Stocks to Build Lasting Wealth

Canadian REITs on sale! See how grocery-anchored retail properties offering 9% yields could turn $6,000 into lasting wealth despite US…

Read more »

rain rolls off a protective umbrella in a rainstorm
Dividend Stocks

Economic Headwinds: Should You Still Consider Buying the Dip?

A market dip might seem like a bumpy road, but it can be far smoother in the future with the…

Read more »

e-commerce shopping getting a package
Dividend Stocks

Consumer Spending Plays Amidst the Current Market Dip

Consumption may go down in market dips, but certain consumer stocks are certainly better off than others.

Read more »

Asset Management
Dividend Stocks

12% Dividend Yield! I’m Buying This TSX Stock and Holding for Decades

Stocks with high-dividend yields carry risks. But they could be a good long-term investment. Here is a 12% dividend stock…

Read more »

Canadian flag
Dividend Stocks

How I’d Build a Foundation of Canadian Value Stocks in My Investment Strategy

Canadian investors can explore iShares Canadian Value Index ETF for value stock ideas to build a foundation for their diversified…

Read more »

Canadian dollars are printed
Dividend Stocks

How I’d Transform a $30,000 TFSA Into a Cash-Flow Machine

Here's why TFSA investors should consider owning dividend stocks such as Mullen Group in 2025.

Read more »