When thinking of the terms “growth stock” and “tech stock,” Canadian investors might immediately think about Shopify. After all, the blue-eyed tech company took off quite dramatically when it started trading on the TSX.
I believe that Shopify is one of the best stocks in terms of performance.
Shopify multiplied shareholder investments through incredible capital gains. If you’re an investor looking for massive returns and possibly to double your money, I wouldn’t recommend Shopify.
The company’s growth has slowed down; while its growth may continue, it might have grown past the point where it could double your money in a year.
Shopify, however, isn’t the only game in town for Canadians. If you’re looking to invest in a growth stock with the potential to grow your investment by 100%, you might want to consider looking into the prospects of up-and-coming tech stocks.
The next tech stock darling on the TSX could be Lightspeed POS (TSX:LSPD). The company is a commerce-enabler that can help traditional retailers level up and come up with an equal footing to e-commerce stores disrupting their businesses.
The next Shopify
If you’re looking for a stock that can give you phenomenal returns as Shopify did, your best bet could be a stock that’s performing like Shopify did back when it started.
Lightspeed bears a remarkable resemblance to Shopify in the sense that it is also a significant prospect in the e-commerce industry.
The company also has a big play on digital payment solutions, big data, and is entering an industry ripe for tremendous growth. The growth potential for Lightspeed is remarkably high because it is one of the first entrants in the sector where demand is expected to skyrocket.
The company has a gross profit margin at $53.88 million at the time of writing, and a team well-equipped to capitalize on a significant portion of the industry.
Down to buy on the dip
In the most recent move, Lightspeed POS acquired an Australian cloud-based POS firm called Kounta. Lightspeed bought the Australian firm for US$35.3 million in a bid to expand Lightspeed’s presence in the Asia-Pacific region. While profitability for the company might not always be in the green right now, acquisition does spell good news.
At writing, Lightspeed stocks are down 32.03% from share prices that rose as high as $49.7. The current share price of $33.04 makes Lightspeed a potentially good buy on the dip. The company has been consolidating in the past few weeks and appears poised to take the e-commerce and retail industry by storm.
Analysts are pegging Lightspeed as a unanimous buy right now. The stock is quite expensive, trading at 23 times forward sales. LSPD expects to grow its sales by 50% to $116.14 million in fiscal 2020 and by 49.5% to $173.6 million in fiscal 2021.
The stock certainly has long-term potential and could be the perfect stock to pick up and double your investments.
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Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns shares of Lightspeed POS Inc. Shopify is a recommendation of Stock Advisor Canada.