When investing for tomorrow, focus on high-growth TSX stocks with the ability to deliver above-average returns. While these spitfire stocks can help generate significant wealth over time, one should focus on diversifying their portfolio, which can ensure stability while spreading risk across different sectors and companies.
Against this background, here are a few TSX stocks that could deliver above-average returns in the long run.
Cameco
Investors looking to invest for tomorrow could consider adding Cameco (TSX:CCO) to their portfolios. It is a leading supplier of uranium fuel. Moreover, it has controlling ownership in some of the highest-grade uranium reserves globally with low-cost operations. Furthermore, its strategic investments throughout the nuclear fuel cycle, including a stake in Westinghouse Electric Company and Global Laser Enrichment, strengthen its market position.
Cameco stock is up about 119% in one year. Moreover, it has gained over 224% in three years. The momentum in Cameco’s business will sustain, led by the acceleration in demand for nuclear power, which will support its share price.
The rising electrification needs, global decarbonization efforts, and surging energy demands from data centres powering artificial intelligence (AI) offer significant tailwinds. Cameco is well-positioned to capitalize on demand led by its integrated business model, extensive industry footprint, and efficient production capabilities.
Looking ahead, the company stands to benefit from long-term supply contracts. Moreover, planned expansions and ongoing exploration projects will unlock new opportunities. Its strong market position and diversified operations across the nuclear fuel value chain make it an attractive long-term investment.
Bombardier
Shares of business jet manufacturer Bombardier (TSX:BBD.B) could be a solid addition to your portfolio to generate above-average returns. The stock has soared roughly 88% over the past year and nearly 464% in three years, reflecting a solid demand environment and significant growth prospects.
A recent order of 50 aircraft, valued at US$1.7 billion and paired with a long-term service agreement, has injected fresh optimism into the market. With delivery set to begin in 2027 and customer options for an additional 70 jets, the deal’s potential value could exceed US$4 billion, reflecting robust demand for Bombardier’s high-end business jets.
The combination of aircraft sales and recurring service revenue positions the company for sustained long-term growth. Moreover, the company is likely to see a heavier delivery schedule later this year, particularly in large-cabin jets that command superior pricing and margins, boosting both profitability and free cash flow. This will likely support its share price.
Its services segment is growing rapidly and provides a steady, high-margin revenue stream. Meanwhile, a robust order backlog of US$16.1 billion and a 2.3 times book-to-bill ratio reflect healthy demand from both repeat and new customers. In addition, Bombardier’s expansion into defence and aftermarket services further diversifies revenue with higher-margin, lower-cyclicality segments.
In short, solid demand, strong delivery momentum, service growth, a robust backlog, and a strategic focus on high-margin segments suggest that the stock remains well-positioned for continued upside.
The bottom line
Investing in high-growth TSX stocks like Cameco and Bombardier offers the potential for substantial long-term returns. Both companies have strong market positions, significant growth catalysts, and solid demand for their offerings that will drive their financials and share price.
