The main TSX benchmark staged a sharp recovery of 7.3% in the fourth quarter of 2023, delivering its best performance in 10 quarters. This Canadian stock market rally started due mainly to investors’ hopes that central banks in the United States and Canada are ready to slash interest rates. However, the hotter-than-expected latest consumer inflation data from the United States has once again reignited the possibility that the Federal Reserve will keep interest rates elevated for an extended period. This is one of the key reasons why the TSX’s index is continuing to witness a roller-coaster ride in January 2024.
Despite the ongoing economic uncertainties, the strong fundamental outlook of many growth companies makes them stand out in 2024. That’s why any short-term declines in their share prices could be an opportunity for long-term investors to buy them at a big bargain. In this article, I’ll highlight two of such unstoppable TSX growth stocks you can buy if the market falls again.
Constellation Software stock
Constellation Software (TSX:CSU) is my first TSX growth stock pick you can consider if the ongoing economic uncertainties drive its share prices lower in 2024. This Toronto-headquartered tech company offers customized software solutions to public and private organizations across the globe, with the United States and the United Kingdom being two of its largest markets. After ending 2023 with solid 55.4% gains, CSU stock has risen 6.1% in January so far to currently trade at $3486.92 per share with a market cap of nearly $74 billion.
The company’s strong financial growth trends could be the primary reason for this unstoppable TSX stock’s recent upward journey. In the first three quarters of 2023, Constellation reported a 27.4% YoY (year-over-year) jump in its total revenue to US$6.1 billion. Besides 8% YoY organic sales growth, the positive contribution of its recent acquisitions helped the company post solid revenue growth. With this, Constellation’s adjusted earnings in these nine months jumped 13% from a year ago to $48 per share.
As Constellation continues to focus on the strategy of making new quality acquisitions to accelerate its growth further, its share prices could continue to rally in the long run.
Celestica stock
Celestica (TSX:CLS) could be another attractive TSX stock to consider in 2024 if another round of the stock market selloffs leads to a pullback in share prices. The company primarily focuses on making hardware platforms and supply chain solutions for other businesses. After delivering 278% positive returns in the previous three years, CLS stock has seen a minor 1% decline so far in January 2024, currently trading at $38.44 per share with a market cap of $4.6 billion.
This top TSX growth stock rallied by over 154% in 2023 alone, making it the top-performing TSX Composite component for the year. A continued strength in the demand for its services globally drove the revenue of this Toronto-headquartered firm up by 11.8% YoY in the first three quarters of 2023 to US$5.8 billion. To add optimism, its adjusted earnings in these three quarters increased even at a higher rate of 23.7% YoY to US$1.67 per share, reflecting the company’s ability to maintain strong profitability despite macroeconomic challenges.
As Celestica expects to post positive revenue growth across each of its business segments in 2024, I wouldn’t be surprised if this unstoppable TSX growth stock continues to outperform the broader market by a wide margin despite the short-term market volatility.
