The primary goal of investing is to accumulate sufficient wealth and enjoy a comfortable life in retirement. Over the years, equities as an asset class have allowed long-term investors to enjoy inflation-beating returns.
In this article, I have identified two Canadian stocks that are well-positioned to outpace the broader market by a significant margin. Let’s see why investing in these two growth stocks can help Canadians accelerate their retirement plans.
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Is this TSX stock undervalued?
Valued at a market cap of $800 million, Black Diamond Group (TSX:BDI) has returned 20% to shareholders over the past year. Black Diamond Group rents and sells modular space and workforce accommodation solutions across Canada, the United States, and Australia. The company operates two segments:
- Modular Space Solutions provides office units, storage, and specialized facilities to the construction, education, healthcare, and government sectors.
- Workforce Solutions offers temporary housing and logistics services for remote workers.
In Q2 2025, the modular space and workforce accommodation provider reported revenue of $105.4 million, an increase of 10% year over year. Its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) rose 5% to $29.2 million.
The company’s core rental revenue totalled $38.6 million, driven by capital investments in fleet assets and improving market conditions. Modular Space Solutions performed well, setting a quarterly record with rental revenue of $26.4 million, up 19% from the year-ago period.
Black Diamond maintains over $152 million in contracted rental revenue, providing visibility into future growth. It raised $40.7 million through a bought deal financing in July, strengthening its balance sheet for potential acquisitions and capital deployment opportunities.
Management expressed optimism about emerging opportunities in Canada’s resource sector, supported by increased bidding activity for workforce solutions projects. The company expects current operating trends to continue through 2025, with a potential inflection point in activity levels during mid-to-late 2026.
Analysts tracking Black Diamond stock forecast adjusted earnings to increase from $0.46 per share in 2024 to $0.84 per share in 2027. In this period, its free cash flow is expected to improve from $2.2 million to $87.2 million. If the TSX stock is priced at 20 times forward FCF, which is reasonable, it could more than double over the next 18 months.
Is Kraken Robotics stock still a good buy?
Valued at a market cap of $1.3 billion, Kraken Robotics (TSXV:PNG) stock has more than doubled over the past year. Kraken is a marine technology company that designs, manufactures, and sells sonar sensors, optical sensors, batteries, and underwater robotic equipment for unmanned underwater vehicles.
It serves military and commercial markets globally, offering products like synthetic aperture sonar systems, deep-sea batteries, towed underwater vehicles for seabed mapping, and autonomous launch/recovery systems for marine operations.
Kraken has increased its revenue from $3.5 million in 2017 to $91 million in 2024. Its growth story is far from over, given analysts forecast sales to rise to $292 million in 2029.
Analysts tracking the small-cap stock forecast adjusted earnings to increase from $0.09 per share in 2024 to $0.18 per share in 2027. In this period, its free cash flow is expected to grow to $43 million, compared to an outflow of $16.7 million in 2024. Despite its stellar returns, Kraken stock trades at a 10% discount to consensus price targets in September 2025.
