There has never been a better time to buy high-growth TSX stocks. Many are priced at a deep discount despite their rosy futures.
For big gains, you often have to think outside the box. What is the market ignoring? Where can you maximize the risk-reward trade-off?
Other times, your best bet is to stick with what’s working. One of the stocks below has already risen 30 times in value, but there’s even more upside to go.
Bet on what works
Shopify (TSX:SHOP)(NYSE:SHOP) is a millionaire-maker stock. If you invested just $1,000 in 2015, you’d have $30,000 today. The secret is built right into its business model.
Shopify is considered a platform business. This is exactly what it sounds like. These companies build the underlying tech platform, allowing others to build on top. When done right, platform stocks can skyrocket for years at a time.
Perhaps the best example of a platform business is Microsoft and its Windows operating system. Microsoft built the underlying tech layer, but outside developers built the rest. Nearly everything a person does on a Windows computer wasn’t made by Microsoft. This approach allows these companies to scale rapidly.
Shopify replicates this success with its e-commerce platform. The company doesn’t make apparel, but Allbirds uses the platform to sell its shoes. Nor does the company sell women’s health products, but De Lune leverages the Shopify platform to do just that.
Shopify doesn’t need to expand itself — its customers do that instead. With a $130 billion valuation, this should eventually become the next $1 trillion stock.
This COVID-19 stock can soar
Canada Goose (TSX:GOOS)(NYSE:GOOS) shares were crushed during the COVID-19 bear market and still haven’t recovered fully.
The problem is that the market hates retail stocks right now. That’s understandable. Shutdowns and volatile consumer spending hit the sector hard. But if you’re willing to look ahead, you’ll realize that Canada Goose can chart a different path.
Right now, roughly one-third of its sales come from Canada, with another one-third from the U.S. The final third comes from international sales. While that’s a relatively small piece of the pie, it’s the most exciting.
Before the pandemic began, international sales were growing by more than 60% per year, versus 25% annual sales growth for North America. This story was always about international sales growth, even if the market never understood that.
Shares have gone on a massive run over the last month or two, but if you’re willing to wait another few years, the gains should continue.
No one is watching this
BlackBerry (TSX:BB)(NYSE:BB) is a forgotten stock. Shares trade at three times sales even though its industry trades at 10 times sales.
But what is its industry? It’s not smartphones, but rather cybersecurity software.
Over the years, BlackBerry completely reinvented itself. It’s now focused on high-margin software sales with high growth potential. It’s playing in some massive markets, including self-driving cars and the internet-of-things.
Once the market catches on, this stock could quickly double or triple. As its end markets heat up, further growth is on the table.
