Fearless Forecast: 2 Tech Stocks Could Climb to the Top in 2020

The Real Matters stock and Lightspeed stock are seen to emerge as the TSX’s top performers in 2020. Both had stellar performances last year, and the chances of duplicating the feat are high.

| More on:
Male IT Specialist Holds Laptop and Discusses Work with Female Server Technician. They're Standing in Data Center, Rack Server Cabinet with Cloud Server Icon and Visualization

Image source: Getty Images

All eyes are on the Toronto Stock Exchange (TSX) now that market strategists are painting a rosy picture. The index might set new records in 2020. Their crystal balls are saying the financial stocks will do better, but the leaders will come from the technology sector.

The fearless forecast is that technology developments will continue, and the sector is unlikely to experience a slump. If the predictions should come true, then you must keep a close watch on Real Matters (TSX:REAL) and Lightspeed (TSX:LSPD).

Hottest stock in 2019

Real Matters might do a repeat performance in 2020 after a stunning showing last year. This $1.12 billion network management company was the best-performing tech stock. From $3.30 on December 31, 2018, Real Matters finished 2019 at $12.32 or a jump of 273.33%.

The question today is whether this company that provides network services for the mortgage and insurance industries can maintain the same pace of growth. Last year, it beat the top and bottom-line estimates in all quarters. As a result of the exponential gain, Real’s market cap ballooned to $1 billion.

Over the next five years, the annual growth estimate is 56.8%. With the high rate, REAL should count as among the TSX’s best growth stocks.

Investors are eagerly awaiting the company’s Q1fiscal 2020 financial results on January 30, 2019. If Real reports another impressive quarterly result, the uptrend should continue.

Homerun

Lightspeed was the largest tech IPO in nine years when it went public on March 8, 2019. As investors were starving for tech stocks, the company was able to $179 million on its market debut. From $18.90 closing price on opening day, Lightspeed finished 2019 at $36.07 or 90.85% higher.

Next to Shopify, this $3.84 billion tech firm that specializes in point of sale (POS) cloud solutions with the highest expected growth rates in the technology sector.

The patrons or users of the POS cloud solutions are small businesses that are predominantly restaurants. With many potential clients for tapping, there’s plenty of room for growth.

This year, the growth estimate is 92.6%, although analysts covering the stock expect earnings to grow by an average of 75% over the next few years. Lightspeed is aggressively pursuing growth through acquisitions. Management believes the strategy should drive growth.

At present, Lightspeed is cash-rich with no considerable debt, and has yet to draw from its available credit line. More and more small and medium-sized businesses in over 100 countries are using the company’s cloud-based commerce platform. Its all-in-one solution is helping restaurants and retailers to grow or expand the business.

The next quarterly earnings report on February 6, 2020, is also highly anticipated.

Strong growth potentials

The lives of people are changing with the many technological advances. Real Matters facilitate transactions in the mortgage and insurance industry while Lightspeed assists businesses worldwide to operate smoothly.

Also, tech stocks in Canada are few but companies with massive growth potentials are in the tech sector. You can choose either stock. Any of the two could ultimately be the best performer in 2020.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Christopher Liew has no position in any of the stocks mentioned. The Motley Fool owns shares of Lightspeed POS Inc.

More on Tech Stocks

Smiling diverse couple holding Christmas presents while walking through a winter forest
Tech Stocks

3 Best Tech Stocks in Canada to Buy in December 2022

Do not wait for a Santa Claus rally. Tech stocks like Nuvei (TSX:NVEI) still look attractive.

Read more »

A data center engineer works on a laptop at a server farm.
Tech Stocks

Tech Selloff: 1 TSX Stock Down 76% to Buy Before it Roars Back

Shopify is a TSX tech stock that is down 76% from all-time highs. But is SHOP stock a buy right…

Read more »

Question marks in a pile
Tech Stocks

Should You Invest in Absolute Software Stock Right Now?

Absolute Software (TSX:ABST) is a tech stock that is worth your attention, as it offers exposure to exciting security markets.

Read more »

Online shopping
Tech Stocks

Should You Buy Shopify Stock If the Rate Hike Cycle Slows?

Is SHOP stock a buy after its 72% drop this year?

Read more »

Doctor talking to a patient in the corridor of a hospital.
Tech Stocks

3 Healthcare Stocks to Buy for Long-Term Passive Income

Healthcare stocks provide exposure to an essential service sector. They are also the best for passive income in the short…

Read more »

edit Women wearing red sweater shopping online and using credit card at home office
Tech Stocks

Shopify Stock Soars as Tech Stock Breaks Another Black Friday Record

Shopify (TSX:SHOP) stock jumped on the report of beating Black Friday sales records of 2021, and there's still Cyber Monday…

Read more »

stock data
Tech Stocks

Better Buy: CGI Stock or Constellation Stock?

Not all tech stocks are bad, and Constellation stock (TSX:CSU) and CGI (TSX:GIB.A) prove that. But when it comes to…

Read more »

healthcare pharma
Tech Stocks

Here’s Why I Just Bought WELL Health Stock

Although there are several high-quality stocks you buy undervalued today, WELL Health Technologies has to be one of the best.

Read more »