Turning $7,000 into $70,000 sounds like the sort of result that requires discovering the next top stock before everyone else. It doesn’t. Given enough time, a reasonably strong annual return can do most of the work.
At an average return of 8%, $7,000 would grow to approximately $70,000 in just under 30 years. Raise the return to 10%, and the journey takes about 24 years. At 12%, it takes slightly more than 20 years.
| AVERAGE ANNUAL RETURN | APPROXIMATE TIME TO REACH $70,000 |
|---|---|
| 8% | 30 years |
| 10% | 24 years |
| 12% | 20 years |
| 15% | 17 years |
Those returns aren’t guaranteed, and the faster scenarios become increasingly difficult to sustain. Still, this table shows that investors don’t necessarily need one miraculous year. They need time, reinvestment, and a company capable of growing for decades.
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Time is a strong compounder
The first doubling often feels painfully slow. At 10% annually, the initial $7,000 would take approximately seven years to reach $14,000. It could then double to $28,000 around seven years later, before reaching $56,000 after another seven.
Inside a Tax-Free Savings Account (TFSA), those returns can compound without Canadian income tax. The eventual withdrawal also won’t be taxable. However, a loss doesn’t restore contribution room, making diversification particularly important when investing through a TFSA. The goal is to then find a business with durable demand, a large backlog, and several ways to keep expanding.
WSP Global (TSX: WSP) currently fits that description.
WSP
WSP provides engineering, environmental, design, and consulting services for transportation, buildings, water, energy, mining, and other major projects. Its customers include governments, utilities, and private companies. That creates several potential growth routes. Aging roads and water systems need upgrades. Power grids must expand for electrification and data centres. Cities require transit, while mining companies need engineering support to develop the materials used throughout the energy transition.
WSP stock doesn’t need every market to boom simultaneously. Its international footprint and range of services let growth come from different regions and industries. Second-quarter net revenue increased 22.9% year over year to $4.3 billion, including 5% organic growth.
More importantly, backlog climbed 23.2% to a record $20.1 billion. That backlog represents work already awarded but not yet completed. It doesn’t guarantee future profit, but it gives WSP stock considerably more visibility than a company hoping customers appear next quarter.
A reasonable price
WSP stock recently traded near $183, down significantly from their $291.46 52-week high. Based on current forecasts, the stock trades around 15 times forward earnings.
That valuation is important. WSP stock doesn’t need to become the next top stock for shareholders to do well. It needs to increase earnings, convert its backlog into cash, and avoid giving away too much of that growth through expensive acquisitions or new shares.
To turn $7,000 into $70,000 within 20 years, WSP would need to produce an average annual total return of approximately 12.2%. That could come from earnings growth, dividends, and changes in valuation. It’s an ambitious target, not a forecast.
Considerations
Acquisitions are the obvious risk. Buying other consulting businesses has helped WSP stock expand quickly, but it also increases debt and integration demands. The company’s leverage moved above management’s target range following its TRC acquisition.
Infrastructure spending can also be delayed by government budgets, permitting, or economic weakness. A large backlog is only valuable when WSP stock completes the work at acceptable margins and collects the cash.
I’d therefore make WSP stock one position within a diversified collection of Canadian growth stocks, rather than asking it to carry an entire TFSA alone.
Bottom line
A $7,000 investment can become $70,000 without delivering an overnight jackpot. At 12% annually, the math requires approximately 20 years. At 8%, it requires roughly 30.
WSP stock offers record backlog, organic growth, infrastructure exposure, and a valuation that leaves room for execution. Whether it produces a tenfold return will depend on earnings, cash flow, acquisition discipline, and patience.
The most dependable ingredient is the one investors control: giving compounding enough time to work.
