Despite the ongoing Israel-Iran conflict, Canadian equity markets have continued their upward momentum, with the S&P/TSX Composite Index reaching a fresh record high yesterday. The benchmark is now up 8.9% year to date, supported in part by rising commodity and precious metal prices. However, the geopolitical tensions and the potential inflationary impact of elevated commodity prices remain key risks for investors.
That said, those with a long-term investment horizon should avoid being overly concerned about near-term volatility. Instead, periods of uncertainty can present opportunities to accumulate fundamentally strong growth stocks with the potential to deliver outsized returns over time.
Meanwhile, growth stocks often trade at higher valuations and have evolving business models, making them inherently more volatile. As such, they are better suited for investors with a higher risk tolerance. For those comfortable with short-term fluctuations, these two growth stocks could be compelling additions to a long-term portfolio.
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Celestica
Celestica (TSX:CLS) supplies critical data centre infrastructure for AI (artificial intelligence), cloud, and hybrid cloud environments. As companies move from pilot AI programs to embedding AI across core operations—and as individuals increasingly use AI-powered tools—demand for computing power has surged. In turn, hyperscalers are ramping up data centre investments, creating strong long-term growth opportunities for Celestica.
The Toronto-based company is reinforcing its position through innovation and capacity expansion. It continues to develop advanced networking switches and storage solutions to meet evolving customer needs. Recently, Celestica announced plans to expand its U.S. manufacturing operations to support the production of complex data centre hardware. It is also strengthening its global footprint to deliver high-reliability manufacturing, advanced design engineering, and end-to-end supply chain services. To capitalize on rising demand, management plans to increase capital expenditures to $1 billion this year.
Reflecting solid momentum, Celestica has raised its 2026 outlook. Management expects revenue to reach $17 billion, representing a 37.2% year-over-year increase, while adjusted earnings per share (EPS) could rise 44.6% to $8.75.
Despite these strong fundamentals, the stock has faced pressure amid concerns about a potential “AI bubble,” driven by elevated valuations and heavy capital spending across the sector. The company has lost 29% of its stock value from its 52-week high and is down 11% year to date. However, the recent pullback has moderated its valuation, with next-12-month price-to-sales and price-to-earnings multiples at 1.8 and 29.8, respectively. Given its robust growth outlook and reasonable valuation, Celestica appears well-positioned as a long-term investment opportunity.
5N Plus
Another growth stock that stands out for long-term investors is 5N Plus (TSX:VNP), a producer of specialty semiconductors and performance materials. With a strategic focus on value-added products in high-growth end markets, flexible global sourcing and manufacturing capabilities, and strong customer relationships, the company has continued to deliver impressive financial performance.
In its recently reported fourth quarter, revenue rose 44% year over year, while adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) increased 48%. The company ended 2025 with a backlog of $394.9 million, representing 353 days of annualized revenue, highlighting strong demand visibility. Meanwhile, net debt declined from $100.1 million in the prior-year quarter to $50.3 million, bringing its net-debt-to-EBITDA ratio down to 0.54 — a sign of improving financial strength.
Favourable industry trends are also supporting growth. Rising demand for solar energy and the structural expansion of space-based observation, satellite communications, and security applications are creating meaningful tailwinds. To capitalize on these opportunities, 5N Plus is expanding its germanium recycling and refining capacity at its St. George, Utah, facility and increasing solar cell production capacity at AZUR SPACE Solar Power GmbH by 25% this year.
Reflecting these growth drivers, management expects adjusted EBITDA to range between $100 million and $105 million this year, with the midpoint implying a 10.9% increase over the previous year. Although the stock has surged more than 70% year to date, its strong fundamentals and favorable market conditions suggest that the momentum could continue over the long term.
