Written by Robin Brown at The Motley Fool Canada
The optimal time to invest in growth stocks is when they are momentarily undervalued due to temporary factors that are not intrinsically tied to the business. These factors can include a market downturn, macroeconomic concerns, or setbacks from competitors.
Determining whether a company’s difficulties are temporary or permanent requires careful analysis. However, investing the time to research can lead to significant rewards, as short-term problems can present valuable long-term buying opportunities.
If you’re in search of promising growth stocks that may currently be undervalued, consider these three stocks to purchase today.
Propel Holdings (TSX:PRL) has shown remarkable growth for investors over the past several years, with its stock price increasing by over 250% in five years, alongside revenues growing at an annual rate of 43% and earnings per share climbing at 70% annually.
Propel has established an impressive lending platform that targets the non-prime lending market. While this sector involves higher risk due to lower credit quality, there is substantial demand from consumers seeking access to credit. The company recently made a major acquisition in the U.K., acquiring a successful lender in the non-prime market, which may pose short-term challenges but is likely to enhance profitability once fully integrated. Currently, Propel’s stock is valued at 15 times its earnings, presenting a potential for high returns given its growth rate could be double that figure.
Another attractive option is TFI International (TSX:TFII), which has experienced a 35% decline in 2025 but boasts a 110% increase in the past five years and a remarkable 415% increase over the last decade. This firm’s strong performance stems from its exceptional operations and solid capital management, making it a valuable buy at its current price.
Lastly, TerraVest Industries (TSX:TVK) outshines both companies, with its stock reflecting an 860% increase over the last five years and a staggering 2,180% growth over the past decade. Though the recent earnings report revealed weaker-than-expected results, TerraVest’s expertise in acquiring and managing industrial businesses positions it well for future rewards.
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