Investing in growth stocks might not seem like the best idea amid the stock market volatility right now. However, investing in higher-risk stocks does not mean you must risk everything to get good returns on your investment.
You can even invest an amount as modest as $50 to buy shares of fundamentally strong Canadian stocks with immense growth potential. This way, you can add high-growth investments to holdings to capitalize on potential gains without taking unnecessary risks.
The key to success is identifying stocks with solid underlying businesses, reliable business models, and strong long-term growth potential. To this end, here are two TSX stocks that you can consider adding to your portfolio as the end of the year draws closer.
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MDA Space
MDA Space Ltd. (TSX: MDA) is a $2.9 billion market-cap company that might grow increasingly relevant in the coming years. The international space mission partner company provides technology, solutions, and services to the growing space industry worldwide. Its advanced space solutions are driving the company’s top line at a solid pace. Growing demand for the solutions and services it offers has been the tailwind this company needs to deliver stellar growth.
The company faced a setback with the EchoStart deal it was working on falling through the cracks. However, a $4.6 billion backlog means that the company has little to worry about. The core business continues to perform well.
As of this writing, it trades for $22.74 per share, and I think it is too attractively priced to ignore. While it might still be a while until we see the global space industry launch to new heights, right now can be a good time to become an early investor and leverage the eventual uptick.
5N Plus
5N Plus Inc. (TSX: VNP) is another attractive investment to consider for growth-focused investors. The $1.6 billion market-cap company is a leading producer of specialty semiconductors and performance materials worldwide. The company’s products are useful across several industries requiring specialty materials. The solid demand for its products has helped the company deliver solid financials.
The demand for its products and services is only expected to grow in the coming years. Being the leading supplier of ultra-high-purity semiconductor materials outside of China puts the company in a pole position to enjoy considerable long-term success.
As of this writing, 5N Plus stock trades for $18.40 per share. Adding its shares to your holdings might let you capture significant capital gains in the long run. I have a feeling that the stock will perform well once the ongoing market volatility subsides.
Foolish takeaway
Investing in stocks because they are cheap isn’t the best way to identify good bargains on the stock market. Doing your due diligence to identify high-quality assets trading at discounts from inherent values and long-term growth potential is a better approach to building a winning portfolio. To this end, MDA Space stock and 5N Plus stock can be good additions to your self-directed investment portfolio.
