If you are saving or investing for long-term goals like retirement, now is the time to invest in stocks that would significantly boost your retirement fund. Thanks to the recent pullback in top TSX stocks, investors can now buy shares of high-growth companies at prices significantly below their highs.
Further, as stocks outperform all other asset classes in the long term, investing in stocks greatly enhances your return potential. While several stocks are trading at an attractive discount, here are my top picks that could deliver superior returns.
Tech stock worth investing in
As top tech stocks have corrected about 60-80%, investing in them could prove to be a smart move. Among top tech companies, Shopify (TSX:SHOP)(NYSE:SHOP) is a must-have stock in your retirement portfolio.
Shares of this internet-based commerce platform provider have trended lower on growth concerns. Moreover, an uncertain economic trajectory is limiting the swift recovery in its price. It’s worth mentioning that Shopify stock has corrected about 79% from its 52-week high and has the potential to deliver stellar returns in the long term.
Shopify’s growth could accelerate as e-commerce demand gains steam. Moreover, easier year-over-year comparisons and ongoing digital shift will likely support its growth in the coming years.
Its new commercial initiatives, aggressive investments in e-commerce infrastructure, and product expansion bode well for growth. Moreover, its growing penetration in existing markets, expansion of its existing products to new geographies, and rollout of new features to support its merchant solutions offerings provide a solid base for growth.
Furthermore, Shopify’s investments in POS and Shopify Fulfillment Network (SFN), growing penetration of Shopify Payments and Capital, partnerships with social media companies, and the acquisition of Deliverr strengthen its competitive positioning and could add more paying merchants to its platform.
A high-growth financial services company
goeasy (TSX:GSY) is minted money for its shareholders by consistently outperforming the broader markets by a wide margin. It offers leasing and lending services to customers with non-prime ratings. Moreover, the strong demand for its offerings has led the company to deliver robust double-digit sales and earnings growth, which supported the uptrend in its stock price.
Its ability to deliver stellar earnings has allowed goeasy to boost its shareholders’ value through higher dividend payments. It has paid dividend for the past 18 years. Further, its dividend has a CAGR of 34.55 in the last eight years.
While the momentum in goeasy’s business sustains, reflected through the strong growth in loan originations, its stock has dropped more than 53% from the 52-week high due to the weak macro backdrop.
I see this dip in goeasy stock as a solid opportunity for investors with long-term goals to invest in this high-growth company. goeasy’s wide lending products range, new product launches, channel and geographic expansion, and the large subprime lending market provides a solid base for growth. Further, strong loan volumes, an increase in ticket size, solid credit performance, and an increased mix of secured loans will likely cushion its margins.
goeasy sees double-digit revenue growth in the medium term. Further, sales leverage and efficiency savings will expand its margins. It projects a 100-basis-point annual expansion in its operating margin over the next three years.
By investing in goeasy stock, investors can expect solid capital appreciation in the long term. Moreover, investors will benefit from its reliable dividend payouts.