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An RRSP, or Registered Retirement Savings Plan, is an account that allows you to grow your savings while providing tax benefits. Canadians can hold several eligible investments in the RRSP, including stocks, bonds and mutual funds.

The RRSP is a government-sponsored retirement account and all contributions made to it are tax deductible. You can contribute up to 18% of your earned income to the RRSP. So if you earned $100,000 in 2021, you could allocate $18,000 to the RRSP, which means your taxable income will be $82,000.

You can withdraw your RRSP savings when you turn 71. It therefore makes sense to identify actions such as easy (TSX:GSY) that have the potential to generate above-market gains over the long term.

An overview of goeasy

goeasy provides loans and financial services to consumers in Canada. It has two business areas:

easyfinancial: It provides unsecured and real estate secured installment loans, loan protection plans, as well as credit monitoring services, among others.

easyhome: It provides leases, furniture, appliances, electronics and computers. As of December 2020, the company operated 266 easyfinancial locations and 161 easyhome stores.

The bull case for goeasy

goeasy is one of Canada’s leading growth stocks and increased sales from $506.19 million in 2018 to $652.9 million in 2020. Analysts expect sales to rise 25.9 % to $822 million in 2021 and 19.8% to $985 million in 2022. In comparison, its adjusted earnings per share are expected to fall from $7.57 in 2020 to $12.03 in 2022.

In the third quarter of 2021, goeasy’s loans were $436 million, a 36% year-over-year increase. It also saw record growth of $101 million in consumer loans. Its point-of-sale, car lending and digital platforms drove new customer growth, which also highlighted the strength of its multi-product and omni-channel strategy.

As a sluggish business, an increase in revenue helped goeasy improve its operating margin to 39.1% in Q3 2021 from 35.2% a year ago. Its adjusted net income and earnings per share rose 48% and 35%, respectively, to $47 million and $2.70.

goeasy’s credit performance is also improving at a steady pace. Its net charges were 8.3% in the third quarter of 2021, compared to 13.2% in the same period of 2019. Its loan loss provision rate also decreased, from 9.64% to 7.83 % during this period, reflecting structural improvements in its portfolio.

Dividends and valuation

goeasy pays investors an annual dividend of $2.64 per share, indicating a forward yield of 1.7%. Its dividends have grown at an annual rate of 34% over the past seven years, making it an attractive dividend-paying growth stock.

GSY stock is currently trading at a multiple of 2.5 forward sales to 2022 and a multiple of price to earnings of 12.8, which is really cheap, given its forecast for 2022. increase in net profit by 36% in 2021 and 17% in 2022. .

Analysts tracking GSY stock have a 12-month time frame average price target $231, or 50% above its current price. Over the past 10 years, goeasy shares have returned 2,680% to investors.