Investors planning to add growth stocks that could skyrocket in 2025 and beyond consider Aritzia (TSX:ATZ) and Shopify (TSX:SHOP). These Canadian stocks are supported by fundamentally strong businesses and consistently deliver solid growth despite macro uncertainty. Looking ahead, the reduction in interest rates and moderation in inflation could significantly boost consumers’ discretionary spending, which will drive these stocks higher. Let’s take a closer look at these stocks.
Aritzia stock
Aritzia is one of the top growth stocks to add to your portfolio. This clothing retailer has been growing its revenue and earnings at a solid pace, driven by a diverse product lineup, exclusive fashion brands, a presence in high-growth markets and prime retail locations, and efficient supply chain management. Aritzia stock has consistently outperformed the broader market index and delivered strong capital gains thanks to its solid financials.
For instance, Aritzia’s revenue has increased at a compound annual growth rate (CAGR) of about 19% since fiscal 2016, and its earnings grew at a CAGR of 13% during the same period. This strong performance has propelled Aritzia stock by 183.2% in five years. Further, the stock has gained over 33.5% year-to-date and will likely skyrocket, driven by expansion into new geographies, digital advancements, and operational efficiencies.
Aritzia plans to expand its U.S. presence, aiming to add 8–10 boutiques annually through fiscal 2027. This move will boost its retail square footage by around 60%. These strategic locations in high-growth markets are expected to amplify revenue and bolter its brand recognition.
Moreover, Aritzia is enhancing its omnichannel capabilities, integrating online and physical retail experiences to enhance customer engagement and drive digital sales. This approach positions the retailer to capitalize on evolving consumer preferences. Further investments in technology and the supply chain, and targeted marketing initiatives will support its growth in the long term.
Looking ahead, management forecasts its top line to increase at a CAGR of 15–17% through 2027. Higher sales and operating efficiency will cushion its bottom line, which will likely increase at a double-digit rate. Aritzia’s solid financials, strength in the e-commerce business, boutique expansion, and increase in omnichannel offerings position it well to deliver solid financials in the long term, which will drive its share price higher.
Shopify stock
Shopify, one of Canada’s leading technology companies, is poised for significant growth as the digital commerce landscape continues to expand. With its multi-channel commerce platform, the company stands to benefit from the ongoing shift toward online and omnichannel retail.
The e-commerce solutions platform has been consistently performing well. Over the past five quarters, Shopify’s gross merchandise volume (GMV) has grown by over 20% each quarter, signalling strong demand for its integrated platform and products, driving its top line. Further, Shopify’s payment penetration rate is growing, reflecting the growing adoption of its payment solutions.
Looking ahead, Shopify is well-equipped to sustain its momentum. The company’s broad range of solutions, combined with the increasing adoption of Shopify Payments and Shopify Capital, will likely contribute to its growth.
Shopify’s offline retail and B2B channels provide significant growth opportunities. During the third quarter (Q3) of 2024, the company reported a 27% year-over-year increase in offline GMV, which has more than doubled in the past three years. Meanwhile, B2B GMV saw impressive 145% year-over-year growth, marking five consecutive quarters of triple-digit gains. These trends indicate strong momentum in these segments.
International expansion is another growth pillar for the company. Markets outside North America are showing rapid growth, with international GMV accelerating to over 30% growth in Q3 2024. Cross-border commerce also played a crucial role, representing about 14% of total GMV.
Beyond its growth metrics, Shopify’s focus on artificial intelligence and an asset-light business model will continue to drive operational efficiency. These strategic moves will optimize Shopify’s operations and position it to deliver sustainable earnings over the long term.
