Spending time in the market can be rewarding if you invest in companies that are growth-focused. You might be an investor who envisions long-term growth. Thus, you should look for a company whose management shares your vision and operates with a mindset of sustainable growth. If the management is firefighting or growing aggressively without clear visibility of the future, you might want to steer clear of them, as they are cyclical stocks.
Source: Getty Images
Finding the right stocks for your long-term wealth strategy
If generating wealth is your objective, you need a company that is growing its operations and size by reinvesting in the business. Such a company may provide a three-year outlook, a long-term roadmap, or highlight pillars of growth. They have a systematic approach to growth and are efficient at navigating the challenges markets throw at them.
They may keep innovating to stay relevant or grow through cash acquisitions. These signs give assurance that management’s goal aligns with yours, and they are also visible with numbers.
Two Canadian stocks in which to allocate $25,000
goeasy
The non-prime lender goeasy (TSX: GSY) stock had a weak start when it made its debut on the TSX in 1996. This company saw one of the worst financial crises in 2008 and survived it. The learning from that crisis has helped it begin its steady growth journey from 2013 onwards.
A robust credit risk model has helped it reduce its net charge-off rate. It is strongly implementing its four-pronged growth strategy – increasing the loan portfolio by offering new loan products, offering ancillary products, tapping new distribution channels, and expanding geographic outreach.
These efforts are visible in numbers. Its revenue and earnings per share (EPS) have grown at a compounded annual growth rate (CAGR) of 19.4% and 28%, respectively, since 2014. The stock has witnessed 12- to 15-month growth cycles, followed by a period of slowdown. With every growth cycle, the stock made a new high, driving its share price up 1,600% since 2013.
At present, goeasy stock has begun its growth rally after bottoming out in April. Now is a good time to buy the stock and hold it for the long term. It is on track to achieve its 2025 outlook of a $5.4 billion loan portfolio and $1.6 billion in revenue. Management also provided a steady growth outlook for 2026 and 2027, giving you something to track performance. The lender has a new chief executive officer, which creates excitement around how he takes the baton from here.
Descartes Systems
Descartes Systems (TSX: DSG) stock had its fair share of crisis in the 2000 tech bubble burst. However, it has survived and begun its growth journey from 2009 onwards as more companies started using software and the trend of digitization kicked in. Although it has come a long way, the company keeps innovating organically and through acquisitions. It offers supply chain and logistics management solutions. Since the pandemic, the company has been growing its e-commerce offerings.
The more solutions it offers, the more customer needs it caters to. Unlike traditional software-as-a-service, Descartes gives customers the flexibility to use a single solution or a complete package for a single consignment or daily orders. While its recurring orders keep revenue flowing, it sees a surge in demand during the holiday season as e-commerce orders surge.
The stock sees seasonality as well as cyclicality and other trade disruptions. The company has grown its revenue and EPS at a CAGR of 13.4% and 19.8%, respectively, between 2015 and 2024. It expects to grow its revenue by 10–15% in 2025 and sustain its adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization margin at 44%.
Descartes’ stock is trading 21% below its 2025 peak due to seasonality as well as tariff war cyclicality. Now is a good time to buy the stock, as it can rebound during the holiday season. The stock has surged 3,970% since 2009 and could continue growing for many years.
