3 Explosive Growth Stocks to Buy in 2023 and Beyond

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Despite the Federal Reserve raising interest rates and the banking crisis due to the collapse of Silicon Valley Bank and Signature Bank, the Canadian equity markets have bounced back strongly in the last few days amid easing inflation. The S&P/TSX Composite Index rose 4.9% from last month’s lows. So, with the improvement in investors’ sentiments, here are three explosive growth stocks you can buy right now.

WELL Health Technologies

WELL Health Technologies (TSX:WELL) is one of the top performers this year by delivering returns of over 70%. Its solid fourth-quarter performance, optimistic 2023 guidance, and continued strategic investments drove its stock price. Meanwhile, the global telehealth market could grow in double digits for the rest of this decade amid the increased penetration of internet services, advancements in telehealthcare technologies, and growing adoption. Given its expansion in the United States and Canada, the company is well equipped to benefit from market expansion.

Further, WELL Health has strategically invested in a German-based medical practice management software-providing company, doctorly GmbH. This investment could help the company expand its footprint to Germany. So, the company’s growth prospects look solid. Despite the recent surge in its stock price, WELL Health still trades at over 50% discount compared to its 2021 highs. Also, its NTM (next 12-month) price-to-sales multiple stands at 1.7, making it an attractive buy.

Nuvei

Nuvei (TSX:NVEI) is another solid TSX stock to have in your portfolio. Supported by its impressive fourth-quarter performance and continued acquisitions, the company is trading over 70% higher this year. Meanwhile, I expect the uptrend to continue amid the growing popularity of digital transactions and its growth initiatives.

In February, the company acquired Paya Holdings, which offers integrated payment and commerce solutions to high-growth verticals in the United States. So, the acquisition has strengthened its presence in the United States. It expanded its product offerings in Australia to allow its clients to access the full suite of its payment solutions. Further, Nuvei also has a strong presence in the sports betting and iGaming industries. 

Amid its multiple growth drivers, Nuvei’s management expects its revenue to grow at an annualized growth rate of 20% in the medium term while achieving an adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) margin of 50% in the long run. So, given its growth prospects and attractive NTM price-to-earnings multiple of 20.5, I am bullish on Nuvei.

Alimentation Couche-Tard

Alimentation Couche-Tard (TSX:ATD), which has returned over 143% in the last five years at a CAGR (compound annual growth rate) of 19.4%, is my final pick. Through its 14,300 stores across 24 countries, the company offers food products, non-food items, and transportation fuels. Supported by its solid underlying business and acquisitions, the company’s EBITDA has grown at a CAGR of over 20% since 2012.

Meanwhile, I expect the uptrend to continue, given ATD’s growth prospects. Despite its solid performance, it has just acquired just 5% of the market share in the highly fragmented United States market, thus offering it a substantial scope for consolidation. The company’s continued acquisitions, ability to integrate these acquisitions, and cost discipline could continue to drive its financials and stock price in the coming years.

The post 3 Explosive Growth Stocks to Buy in 2023 and Beyond appeared first on The Motley Fool Canada.

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* Returns as of 3/7/23

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Fool contributor Rajiv Nanjapla has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alimentation Couche-Tard and Nuvei. The Motley Fool has a disclosure policy.