The tax-sheltered status of the Tax-Free Savings Account (TFSA) makes it an ideal account to hold quality growth stocks. Generally, growth stocks deliver outsized gains during bull runs, allowing Canadian investors to generate game-changing returns over time. In this article, I have identified two top TSX stocks you can buy and hold in a TFSA right now.
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Is this TSX stock undervalued?
Valued at a market cap of $184 million, Electrovaya (TSX:ELVA) designs, develops, and manufactures lithium-ion batteries and battery systems. In the second quarter (Q2) of 2025 (ended in March), it reported revenue of US$15 million, up 40% year over year, with a net income of US$800,000.
The lithium-ion battery manufacturer has now posted eight consecutive quarters of positive EBITDA (earnings before interest, tax, depreciation, and amortization) while maintaining gross margins above 30%.
The company’s US$51 million Export-Import Bank loan is funding a strategic expansion in Jamestown, New York, with cell production expected to begin by mid-2026. This facility represents a crucial shift toward domestic manufacturing, positioning Electrovaya to capitalize on the growing demand for non-Chinese battery supply chains.
The plant’s low-cost electricity, at under US$0.05 per kilowatt-hour, and its 52-acre expansion capacity provide significant operational advantages.
Electrovaya’s proprietary ceramic separator technology continues to command premium pricing in mission-critical applications. Its Infinity batteries deliver over 14,000 cycles compared to typical lithium-ion batteries’ 1,000 cycles, while maintaining a perfect safety record across 30,000 deployed systems. This performance advantage enables the company to evade commodity pricing pressures that afflict the broader battery industry.
Recent announcements include US$16 million in follow-on orders from Fortune 100 customers, as well as expansion into energy storage applications. Its partnership with Toyota Material Handling and growing robotics segment provides diversified revenue streams beyond traditional material handling. Management expects to exceed US$60 million in fiscal 2025 revenue guidance.
Key developments include the launch of demand response systems leveraging artificial intelligence (AI) technology, progress in solid-state battery laboratory testing, and recurring revenue initiatives targeting 10% of total revenue by fiscal 2027. With strong customer relationships and expanding manufacturing capacity, Electrovaya appears well-positioned for sustained growth.
Analysts tracking ELVA stock estimate its free cash flow (FCF) to reach US$76 million in 2029, up from US$4.8 million in 2026. If ELVA stock is priced at 10 times forward FCF, which is relatively cheap, it could gain around 500% over the next four years.
Is this TSX stock a good buy?
Valued at a market cap of $1.1 billion, Docebo (TSX:DCBO) offers an enterprise-facing e-learning platform. Docebo is executing a strategic transformation of its learning management system into an AI-first enterprise learning platform in order to capture the growing demand for intelligent workforce development solutions.
The flagship Docebo Creator tool and planned agent-based automation features represent a shift toward comprehensive content creation and delivery capabilities. This end-to-end approach aims to increase customer stickiness by eliminating the need for users to leave the platform for content development, creating meaningful switching costs, and improving retention rates.
Docebo is strengthening its enterprise execution through strategic partnerships with system integrators, including Accenture and Deloitte. These relationships enhance forecasting discipline and provide access to larger enterprise deals.
Analysts tracking DCBO stock forecast it to increase free cash flow from US$28 million in 2024 to US$158 million in 2029. If the TSX tech stock is forecast at 10 times forward FCF, it could gain over 80% in the next four years.
