Canadian stocks turned slightly negative last week. The TSX Composite Index fell slightly by 0.5% in the second week of May — after posting nearly 2% gains in the first week. Some fundamentally strong stocks are also staging a downside correction lately — especially from the tech sector. It could be a great opportunity for investors to buy such good stocks cheap.
Here are three of my favourite tech stocks to buy this week and hold for the long term.
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Lightspeed POS stock
Lightspeed POS (TSX: LSPD)(NYSE: LSPD) is one of my favourite tech stocks that has seen sharp correction lately. In the last 25 days, Lightspeed stock has lost more than 20% of its value. As a result, its stock is currently trading with 22% year-to-date losses at $70.29 per share.
In the quarter ended December 2020, Lightspeed’s sales rose by 79% on a YoY (year-over-year) basis to US$58 million. In the next couple of quarters, its sales growth is expected to accelerate further, as analysts expect the company to register a 93% YoY revenue growth in the March quarter.
The recent decline in Lightspeed stock could be a great opportunity for long-term investors to add this amazing tech stock to their stock portfolio.
Enthusiast Gaming stock
Enthusiast Gaming (TSX: EGLX)(NASDAQ:EGLX) is a Canadian esports and videogame company with its headquarters in Toronto. Its stock has seen a sharp decline in the last couple of weeks.
Enthusiast’s attractive gaming platform attracts nearly 300 million gamers each month. The company is currently developing a subscription-based social network for gamers. To accelerate the development, it recently agreed to acquire the gamers-oriented technology and data platform Tabwire LLC for US$11 million.
Enthusiast Gaming’s sales growth rate has normalized in the last quarter after witnessing a massive rise in the second half of 2020. The company last week reported its Q1 results with a solid revenue growth rate of 321% YoY. Analysts’ see its sales growth to improve further and rise by more than 400% in the second quarter.
Enthusiast Gaming stock has lost 32% in the last 10 sessions, while the TSX Composite benchmark has risen by 1.4% during the same period. It could be a good opportunity for tech investors to buy this gaming stock on a dip.
Kinaxis stock
Kinaxis (TSX: KXS) is a Kanata-based software subscription firm. Its software primarily allows businesses to analyze their supply chain operations and make informed decisions accordingly.
After registering the 2% YoY sales drop in Q4 2020, Kinaxis’s sales rose by 9.4% to US$ 58 million in the March quarter. Its sales growth trend is likely to improve in the coming quarters, as it is expected to report a double-digit YoY increase in its total revenue in the second half of 2021.
Kinaxis stock has seen 22% value erosion this year so far after posting over 80% gains last year.
Foolish takeaway
Buying stocks when they’re going through a correction is a wise decision to make. Investors can buy these tech stocks amid ongoing correction and hold them for the long term to get handsome returns on their investment.
