Investing in stocks can help generate substantial capital gains over time. Notably, Canadian stocks with solid fundamentals and the ability to grow profitably have historically delivered impressive returns, outperforming the benchmark index and other asset classes. So, for investors planning to invest $1,000 in equity, here are the three best Canadian stocks to buy right now.
Alimentation Couche-Tard stock
Alimentation Couche-Tard (TSX:ATD) is one of the best Canadian stocks for the long term, offering stability, income, and growth. The company operates convenience stores, retails fuel, and offers electric vehicle charging. Its defensive business model and ability to drive traffic even amid uncertain markets help it consistently grow its revenue and earnings and support its share price and dividend payments. Additionally, its focus on strategic acquisitions further accelerates its growth.
The retailer’s revenue and earnings have grown at a compound annual growth rate (CAGR) of 6.2% and 15.2% over the past decade. Thanks to its impressive financials, Couche-Tard stock has increased at a CAGR of over 15% in the past decade, delivering an overall capital gain of 332.8%. The company rewarded its shareholders by increasing its dividend per share at a CAGR of 25.6% during the same period.
Alimentation Couche-Tard’s value pricing strategy, extensive store presence, and focus on improving operational efficiencies will likely drive its future sales and earnings. In addition, its emphasis on strategic acquisitions will likely expand its store base, drive traffic, and accelerate its growth rate.
goeasy stock
goeasy (TSX:GSY) is among the best Canadian stocks to buy right now. The subprime lender is known for delivering impressive capital gains, beating the market averages by a wide margin. For example, goeasy stock has risen at a CAGR of more than 29% in the last five years, generating a capital gain of 259.4%. The growth reflects its solid financials. Notably, its top and bottom lines have grown at a CAGR of about 20% and 28% in the past five years, giving a boost to its stock.
Thanks to its strong earnings growth, goeasy has consistently raised its dividend for the last 10 consecutive years, showing its commitment to reward its shareholders.
The momentum in goeasy’s business will likely be sustained, driven by its leadership in Canada’s subprime lending sector, large addressable market, strong underwriting capabilities, omnichannel offerings, and diverse funding sources. Further, its geographical expansion and new product offerings will boost its revenue growth. Higher revenue, stable credit performance, and operating efficiency will cushion goeasy’s bottom line and drive its dividend payments and share price.
Aritzia stock
Aritzia (TSX:ATZ) is another solid investment for investors with a long-term horizon. This clothing company’s top and bottom lines are growing at a healthy pace, pushing its stock price higher. For instance, Aritzia stock has more than doubled over the past year, outperforming the broader market index.
Looking ahead, Aritzia expects its net revenues to grow at a mid-teens rate through fiscal 2027. Further, it plans to open eight to 10 new boutiques in the U.S. annually and increase its total retail square footage by up to 60% by fiscal 2027. This geographic expansion will drive its sales and earnings.
Further, Aritzia will benefit from the expansion of its omnichannel offerings, increasing brand awareness, lower warehousing costs, and productivity savings.
Overall, Aritzia is well-positioned to expand its sales and profitability, which will support its share price.
