Investing in TSX stocks that are growing at a steady pace while trading at a reasonable valuation should allow you to deliver outsized returns over time. In this article, I have identified two such top Canadian stocks to invest $2,000 in right now.
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Is this TSX stock a good buy?
Valued at a market cap of $563 million, Vitalhub (TSX:VHI) is a health-tech stock that has returned 200% to shareholders since its initial public offering in September 2021. Despite its market-beating performance, the small-cap stock is down 36% from all-time highs, allowing you to buy the dip.
VitalHub provides technology and software solutions for health and human service providers globally. The company offers three main solution categories: patient flow and operational optimization for hospitals, electronic health records and case management for care providers and long-term care facilities, and workforce automation and compliance systems.
VitalHub ended Q3 with annual recurring revenue of $93.7 million, driven by organic growth and acquisitions. The recent acquisitions of Novari and Zesty Healthcare, which now account for 30% of total sales, allowed VitalHub to increase revenue by 94% to $32 million.
Virtual Care adding value
The quarter marked the first full contribution from the Virtual Care segment, which generated $2.5 million in term license revenue. Recurring revenue accounted for $23.6 million, or 74% of total revenue, and management expects this mix to increase steadily toward historical levels.
Services revenue came in higher than anticipated at $5.5 million, driven by project timing and the implementation-heavy nature of the new acquisitions.
The company ended the quarter with $123.8 million in cash and no debt, maintaining capacity for additional acquisitions. Management confirmed active pursuit of both smaller tuck-in deals and larger strategic opportunities while continuing to integrate recent acquisitions.
VitalHub is developing artificial intelligence capabilities across multiple products, viewing AI-powered features as potential add-on revenue opportunities beginning in late 2026.
Analysts tracking the TSX tech stock forecast revenue to increase from $68.6 million in 2024 to $209.5 million in 2029. In this period, adjusted earnings are forecast to grow from $0.11 per share to $0.75 per share. If VHI stock is priced at 20 times forward earnings, which is reasonable, it could surge 90% over the next three years.
Is this Canadian stock undervalued?
Down over 40% from all-time highs, Electrovaya (TSX:ELVA) designs, develops, manufactures, and sells lithium-ion batteries, battery management systems, and battery-related products for energy storage, clean electric transportation, and other specialized applications in North America. It operates an infinity battery cell technology comprising low and high-voltage systems.
Electrovaya has achieved an unusual milestone for battery manufacturers by delivering 10 consecutive quarters of positive EBITDA (earnings before interest, tax, depreciation, and amortization) while positioning itself for significant growth.
It specializes in lithium-ion batteries equipped with its proprietary Infinity Battery Technology, which extends cycle life by approximately 4 times compared to standard batteries. These batteries can reach 10,000 cycles at full discharge and 15,000 cycles under regular use.
CEO Raj DasGupta emphasized a focus on mission-critical applications rather than competing in the commoditized automotive battery market. Electrovaya targets material handling equipment, robotics, airport ground equipment, defense applications, and energy storage, where safety and longevity justify premium pricing.
The company powers 16 Fortune 100 companies across over 300 warehouse sites globally, with major customers including the world’s largest retailers.
ELVA stock is forecast to end fiscal 2029 with free cash flow of US$77 million compared to an outflow of US$4.8 million in fiscal 2025. If the clean energy stock trades at 10 times forward FCF, which is very cheap, it should more than triple over the next three years.
