It goes without saying that investors would like to see their positions gain value over time. However, it’s difficult to predict which stocks could make you richer over the next two decades. In order to put yourself in the best position to see your portfolio grow, investors should look for stocks that are well positioned to succeed. This is a very broad statement, because that could look different for every company.
In this article, I’ll discuss three stocks that could make you rich over the next 20 years.
Don’t underestimate the e-commerce industry
I believe the e-commerce industry will be much bigger in two decades’ time. As the industry continues to grow, I believe Shopify (TSX:SHOP)(NYSE:SHOP) will grow right there alongside it. Over the past year, many investors have turned sour on this growth stock, because of its prolonged underperformance. In June, this stock was trading more than 80% lower than its all-time highs. However, on the heels of a 33% gain over the past month, it’s time that investors revisit this stock.
It’s true that Shopify’s growth rate has slowed down considerably. During its latest earnings presentation, the company reported a 16% year-over-year increase in its second-quarter (Q2) revenue. This compares to a 57% year-over-year increase that was reported in Q2 2021. While this may appear concerning, it’s perfectly normal for larger companies to experience a slowdown in its growth rate. That’s due to the law of large numbers.
What investors should focus on is Shopify’s massive market share in its industry. As of Q2 2022, Shopify reported a 10% share of the American e-commerce space, the second-largest e-commerce market in the world. I believe investors have an amazing opportunity to buy shares at an attractive discount today.
Invest in this mid-cap stock
Topicus.com (TSXV:TOI) is the second stock that investors should consider holding for the next 20 years. What attracts me to this company is its close working relationship with Constellation Software. For those that are unfamiliar, Topicus used to be a subsidiary of Constellation Software. Although it now operates as its own entity, Constellation Software still plays an important role in guiding Topicus. Six members of Topicus’s board of directors are executives from Constellation Software. This includes Constellation Software’s founder and president, Mark Leonard.
In this year alone, Topicus has acquired more than 20 businesses. This suggests that the company aims to grow very aggressively in the near term. If Topicus can follow Constellation Software’s winning playbook, then investors could see this company replicate Constellation Software’s amazing growth over the past decade. Of course, it’s difficult to assume that any company can generate a long-term growth rate of about 30%. But if any stock could do it, I’d bet it’d be Topicus.
This renewable utility company could be a great stock to hold
Many Canadians know that Brookfield Asset Management is an amazing company to invest in. However, have you ever considered investing in its subsidiaries? Among its smaller subunits, Brookfield Renewable (TSX:BEP.UN)(NYSE:BEP) stands out for me.
Its portfolio consists of US$68 billion of power assets. All considered, its facilities are capable of generating about 21 gigawatts (GW) of power. That makes it one of the largest producers of renewable utilities in the world. Investors should also take note of Brookfield Renewable’s development pipeline. The company could increase its generation capacity by 69 GW upon the completion of its current construction projects.
Brookfield Renewable aims to generate 12-15% in returns on an annual basis. Since its inception, this stock has managed to produce an annualized return of 17%. That suggests that the company’s management team has been able to successfully implement an excellent growth strategy. As the renewable utility industry grows, watch for Brookfield Renewable to grow alongside it.
