Investors looking to enhance their portfolio’s long-term returns could consider adding fundamentally strong Canadian growth stocks. These are companies that are growing their revenue and earnings at a solid pace and have the potential to outperform the broader market with their returns. Moreover, using a Tax-Free Savings Account (TFSA) can further amplify your gains. Within a TFSA, capital gains and dividends are tax-free, allowing your investments to grow without hindrance and maximizing the power of compounding.
With this background, here are three Canadian growth stocks I’d buy and hold in a TFSA forever.
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Brookfield Asset Management stock
Brookfield Asset Management (TSX:BAM) could be a solid addition to your portfolio. This TSX stock is poised to benefit from its exposure to sectors with multi-year tailwinds. This alternative asset manager invests in high-quality assets and businesses across diverse geographies and industries. Moreover, its asset-light balance sheet and predictable earnings position it well to deliver strong total returns in the long run.
Brookfield raised a significant amount of capital in 2024, strengthening its investment capacity. This influx of capital and disciplined cost management will drive substantial revenue growth and margin expansion.
Brookfield’s early investments in sectors such as AI infrastructure and clean energy position it well to benefit from their explosive growth. Further, its expansion into the private credit market remains a key catalyst for its future growth. Its investments in digital infrastructure, such as data centers, fibre networks, and telecom towers, position it well to capitalize on the digital shift.
With strong capital deployment and secular tailwinds, Brookfield will likely deliver double-digit earnings growth in 2025 and beyond. This will drive its dividend payments and share price.
goeasy
goeasy (TSX:GSY) is one of the top TSX growth stocks to add to your TFSA portfolio. This subprime lender is growing rapidly, consistently growing its top and bottom lines at a double-digit rate. The company’s strong financial performance supports its dividend payments and drives its share price higher, enabling it to deliver above-average returns.
The financial services company’s top line has expanded at a compound annual growth rate (CAGR) of more than 20% in the past five years. Thanks to the higher sales and operating leverage, its earnings grew faster than revenue. Given its growing earnings, goeasy has consistently returned higher cash to its shareholders through dividend increases. Moreover, its stock price grew at a CAGR of over 36% in the last five years.
goeasy’s wide product range, omnichannel offerings, geographic expansion, and diverse funding sources position it well to capitalize on the large subprime lending market. Higher loan originations will drive its top line at a solid pace. Meanwhile, its solid underwriting capabilities, steady credit performance, and operating efficiency will drive its earnings at a double-digit rate. This will support its future payouts and stock price.
Aritzia
Aritzia (TSX:ATZ) is another top growth stock to add to your TFSA portfolio for solid capital gains. The Canadian clothing company’s sales have grown at a CAGR of 19% since fiscal 2016. Moreover, Aritzia’s adjusted net income has increased at a CAGR of 13% during this period.
Aritzia’s exclusive fashion brands, expansion of boutiques, growing penetration in the U.S., and efficient supply chain have driven its top and bottom lines higher.
Looking ahead, Aritzia plans to open new boutiques, primarily in the U.S. The move will accelerate its growth rate and strengthen brand recognition. Further, the fashion retailer is expanding its omnichannel capabilities, adding more convenience stores and online shopping to support its growth.
While potential challenges such as trade restrictions and tariffs could create short-term headwinds, the company’s long-term growth fundamentals remain solid. The fashion retailer’s top line will likely grow at a double-digit rate, driving its margins. Moreover, its focus on optimizing costs will drive its earnings faster than sales and support its share price.
