It’s often said that a handful of stocks are responsible for most of the stock market’s gains simply because stock market indices tend to be top-heavy. By that, I mean that larger companies tend to affect indices much more than smaller companies. With that said, a handful of Canadian companies could be responsible for the next bull market here in Canada. In this article, I’ll discuss three stocks that could very well be the growth stocks powering the next record run.
This outstanding stock should be in your portfolio
Constellation Software (TSX:CSU) is the first stock that I think could be responsible for a record bull market run on the TSX. This company has very quietly become one of Canada’s most appealing growth stocks since its initial public offering in 2006. For those who are unfamiliar, Constellation Software acquires vertical market software companies. It then provides those acquisitions with the resources necessary to turn them into exceptional business units.
Constellation Software’s business model has been proven to be very successful over the years. With hundreds of acquisitions, Constellation Software’s success is reflected in its stock chart. Since 2006, this stock has gained nearly 17,700%! Despite those gains, Constellation Software stock refuses to slow down. It has gained about 53% over the past year, which greatly outpaces the market. I believe this $69 billion company could help push the TSX to record heights.
Another great stock to hold forever
Growth investors should also consider Brookfield Corporation (TSX:BN). Much like Constellation Software, Brookfield focuses on acquisitions as a way of growing its business. To consider Brookfield’s size, note that the company deployed $65 billion of capital over the 12 months leading into the third quarter (Q3) of 2023. The key difference between Brookfield and Constellation, however, is the industries they operate within. Brookfield has exposure to the infrastructure, insurance, real estate, renewable utility, and private equity industries.
Although growth investors tend to love buying shares of companies that have very exciting businesses, it’s hard to refute Brookfield stock’s performance. Over the past year, this stock has gained 20%. To put that into perspective, the TSX gained just over 7% over the same period. Brookfield is a well-known compounder of wealth. If you’re serious about growth, you should consider picking up some shares today.
Don’t sleep on this stock
Finally, I think Alimentation Couche-Tard (TSX:ATD) could be responsible for much of the growth that we’ll see from the TSX over the coming years. This company is much bigger than the average person may think. Alimentation Couche-Tard operates more than 14,000 convenience stores across 25 countries and territories. It also operates under several banners, including On the Run, Circle K, and Dairy Mart.
A very underrated stock, perhaps because of the nature of its business, Alimentation Couche-Tard stock gained nearly 30% over the past year. That’s a massive performance from this boring company. I can’t envision a future where the average consumer doesn’t visit a convenience store at least once a week. Because of that, I think stocks like Alimentation Couche-Tard could still have a lot of room to grow.
