The United States imposed a 25% tariff on goods imported from Canada and Mexico on March 4. The Canadian government retaliated by imposing tariffs on $30 billion of goods imported from the United States and could expand its tariffs on additional goods in the coming days. Investors are worried that these protectionist policies could lower global growth, thus hurting equity markets. Meanwhile, the S&P/TSX Composite Index has fallen 2.65% over the last 30 days.
Meanwhile, the pullback offers excellent buying opportunities in quality growth stocks. Here are my three top picks.
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Celestica
Celestica (TSX:CLS) is an electronics manufacturing services (EMS) company that has lost around 36% of its stock value compared to its all-time high amid the recent weakness in the broader equity markets. Despite the recent pullback, the company is trading over 112% higher over the previous 12 months. Also, the company trades at 18.7 times analysts’ projected earnings for the next four quarters, which looks attractive considering its high-growth prospects.
The ongoing investments in building artificial intelligence (AI)-ready data centres have created long-term growth potential for Celestica. The company has recently acquired two new projects from a hyperscaler and a digital native company. It would support its customers in designing and producing a fully AI-optimized networking rack. Amid these growth initiatives and solid fourth-quarter performance, the company has raised its 2025 guidance. The new revenue and adjusted EPS guidance represent year-over-year growth of 10.9% and 22.4%, respectively. Considering its growth initiatives, favourable market conditions, and attractive valuation, I believe Celestica would be an excellent buy at these levels.
WELL Health Technologies
WELL Health Technologies (TSX:WELL) is another growth stock I am bullish on due to its healthy growth prospects and improving financials. The growing popularity of virtual healthcare services and increased adoption of software services in healthcare offer the company multi-year growth potential.
Meanwhile, WELL Health is continuing with its inorganic growth and has completed 18 acquisitions since December, adding around $130 million in annualized revenue. It also strengthened its EMR (electronic medical record) and IT services businesses by acquiring Microquest and Bluebird iT. Moreover, the Vancouver-based healthcare company has a solid acquisition pipeline of 165 clinics that can contribute additional annual revenue of $440 million. It also focuses on improving operating efficiency and driving profitability by leveraging its technological advancements and ability to compress acquisition multiples.
Moreover, amid the recent weakness in the broader equity markets, WELL Health has lost around 27% of its stock value compared to its 52-week high. The sell-off has dragged its NTM (next-12-month) price-to-earnings multiple down to 17.9, making it an attractive buy.
Shopify
My final pick is Shopify (TSX:SHOP), which had delivered an impressive fourth-quarter performance last month. Its top line grew 31% to $2.8 billion during the quarter, marking seven consecutive quarters of above 25% revenue growth. The company’s expanding GMV (gross merchandise value), growing customer base, and rising penetration of its payment solutions have boosted its topline. The company’s operating income grew 60.9% to $465 million amid operating leverage and lower headcount. Also, its free cash flows increased by 37% to $611 million while expanding its free cash flow margin by 100 basis points to 22%.
Moreover, Shopify continues to strengthen its R&D (research and development) team to develop innovative products and services to capture the increasing demand amid the growing adoption of the omnichannel selling model. This year, the global commerce company has prioritized its core platform, international, B2B (business-to-business), enterprise, and offline segments, which could support its financial growth. However, the company has been under pressure over the last few days, losing around 20% of its stock value compared to its 52-week high. Considering its healthy growth prospects and discounted stock price, I believe Shopify would be an excellent buy right now.
