In these difficult and uncertain times, wouldn’t you like to see what TSX stocks are working? Wouldn’t you like to see which industries are thriving and which TSX stocks are generating top returns?
Shopify (TSX:SHOP)(NYSE:SHOP) is a phenomenal success story. We all know this. Shopify’s stock price performance reflects this fact, along with its valuation. Ballard Power Systems (TSX:BLDP)(NASDAQ:BLDP), however, is a very different story. Ballard Power is just gaining momentum and recognition. It is nowhere near as well known by investors or as well trusted.
Despite these differences, these stocks have one major thing in common: both Shopify stock and Ballard Power stock are top TSX stock performers in 2020.
Top TSX stock Shopify is changing the world of e-commerce
Up 137% in 2020, Shopify stock is a top-performing TSX stock. In fact, Shopify has been a top TSX stock for many years now. Its five-year return is an incredible 2,729%!
My favourite quote from Shopify’s recent earnings call was from CEO Tobias Lütke. He essentially said that this crisis is “pulling 2030 into 2020.” The rapid growth that was expected in the e-commerce industry by 2030 is happening today. This kind of accelerated growth in demand is huge for the industry.
These new demands in capacity and quality cannot be met with current 2020 e-commerce software and standards. This is where Shopify comes in. Its e-commerce offering and strategy is ahead of its time, thankfully. This has made it possible for Shopify to respond to the unprecedented coronavirus-related demand for everything e-commerce. This is driving higher adoption of e-commerce as well as a migration to Shopify’s platform.
And things just keep getting better for Shopify. With new partnerships with Facebook and most recently Walmart, Shopify is on fire, changing the world of e-commerce.
Expectations are high, and these high expectations are baked into Shopify stock. Ownership of this top TSX stock is also high, with many leading institutional investors owning sizable amounts. This leads us to question how much incremental demand exists.
Ballard Power stock: A top TSX stock with more upside, as it races toward fuel cell adoption and acceptance
Lesser known and less widely held, Ballard Power stock has also been a top-performing TSX stock in 2020. Up 100% so far this year, it is clear that Ballard Power is beginning to see momentum in its race to bring fuel cell powered vehicles to the market. Ballard’s five-year return is also impressive at 593%.
So, what makes Ballard Power stock attractive today? Well, for starters, Ballard’s valuation is lower than Shopify’s valuation, 29 times sales compared to Shopify at 60 times sales. The expectations that are baked into Ballard stock are not as high as those that are baked into Shopify stock. There’s still a lot of skepticism about the company and about its very industry, the fuel cell industry.
Ballard stock is also less widely held. It may soon see a demand surge, as investors clamour for a position in this top-performing TSX stock. Considering the progress that Ballard has made, this may be inevitable.
The path to fuel cell commercialization is becoming brighter. Ballard has made dramatic performance improvements as well as dramatic cost reductions. Consequently, fuel cell orders and deployments are rising significantly in key geographies. There are currently 18,000 fuel cell passenger cars in operation, supported by approximately 400 hydrogen fueling stations. And Ballard Power is capturing a significant share of this market.
Foolish bottom line
Shopify stock and Ballard Power stock are both top-performing TSX stocks in 2020. For different reasons, these companies are transforming their respective industries at an accelerating pace. At this point, Ballard Power stock is closer to the beginning of its rise to success. I believe it has more upside from this point.
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.
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Fool contributor Karen Thomas owns shares of BALLARD POWER. David Gardner owns shares of Facebook. Tom Gardner owns shares of Facebook and Shopify. The Motley Fool owns shares of and recommends Facebook, Shopify, and Shopify.