3 Top TSX Stocks That Could Hold 10X Potential

Investors are always hoping to find stocks that could have 10X potential. Here are 3 stocks for your portfolio.

| More on:
consider the options

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

I’m sure I’m not alone when I say that it would be really nice to find those stocks that can turn my $1,000 into $10,000. Not everyone can claim they’ve got a 10-bagger in their portfolio. However, we know that these types of stocks exist. In fact, Constellation Software is a 94-bagger since its Initial Public Offering (IPO). So how do we find these companies? And here’s the better question: Which companies on the TSX could hold that kind of potential?

In this article, I discuss three top TSX stocks that could have 10 times from today’s prices.

E-commerce will continue to penetrate everyday life

One way to find a stock with 10 times potential is to look at the leaders in emerging industries. E-commerce has been steadily growing over the past decade, but its adoption was significantly accelerated by the COVID-19 pandemic. Within this industry, Shopify (TSX:SHOP)(NYSE:SHOP) stands out as a clear market leader. The company’s platform allows merchants of all sizes to operate online storefronts. Today, more than one million businesses use Shopify to power their online stores.

Shopify has continued to grow each quarter since its IPO. In fact, the company’s monthly recurring revenue (MRR) has never decreased quarter over quarter. That’s remarkable given the fact that companies often see seasonal dips in revenue. Since Q1 2016, Shopify’s MRR has grown at a compound annual growth rate (CAGR) of 45%. The company has also continued to grow its total revenues, even as we exit the pandemic. In Q1 2021, Shopify reported a year-over-year increase of 110% in its quarterly revenue. Clearly, the stock is nowhere near finished growing.

Digital payments will be more common in the future

E-commerce and digital payments often go hand-in-hand. Nuvei (TSX:NVEI) is an emerging contender within the digital payments space. Last year, the company made headlines when it closed the largest tech IPO in Canadian history. This means the company managed to raise more money on its opening day than stock market favourites like Shopify and Lightspeed.

Today, Nuvei offers its omnichannel payment solution across 200 global markets, accepting 450 payment methods in 150 currencies. The company’s list of customers includes international giants like bet365. Unlike other growth stocks, Nuvei has not experienced a significant decrease in value this year. Rather, its stock has continued its hot growth since its IPO, gaining more than 25% in value year to date. A 10 times gain from here would give Nuvei a $125 billion market cap. While that sounds big today, its peers have already comfortably surpassed that size.

Telemedicine is here to stay

The global telemedicine market is expected to reach US$298.9 billion by 2028, which represents a CAGR of 22.4% from 2021 to 2028. Leaders within the telemedicine industry could therefore see tremendous growth over that period. In Canada, WELL Health Technologies (TSX:WELL) is the industry leader. The company operates 27 primary health clinics and offers EMR solutions to more than 2,200 clinics within its network.

WELL Health has managed to enter the massive U.S. health care industry through its acquisitions of Circle Medical and CRH Medical. This provides the company a much larger opportunity for growth than if it had remained completely focused on the Canadian market. Since its IPO, WELL Health is nearly a 62-bagger.

However, its market cap is still only $1.34 billion. Compared to its peers, this company is still very small and a 10 times gain from here would only bring it close to the industry average. There are many opportunities out there for WELL Health.

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 Jed Lloren owns shares of Shopify. Tom Gardner owns shares of Shopify. The Motley Fool owns shares of and recommends Constellation Software, Shopify, and Shopify. The Motley Fool owns shares of Lightspeed POS Inc and recommends the following options: short January 2023 $1160 calls on Shopify and long January 2023 $1140 calls on Shopify.

More on Tech Stocks

potted green plant grows up in arrow shape
Tech Stocks

TFSA Investors: Double Your Investments With These 3 Top Growth Stocks

Despite the volatility, I am bullish on these three stocks, given their solid growth potential.

Read more »

Arrow descending on a graph
Tech Stocks

2 Industries That Saw the Worst Decline Last Month

The TSX has been declining at a sharp angle since the beginning of June. And two industries (crypto and cannabis)…

Read more »

Dividend Stocks

TFSA Investors: Turn $1,000 Into $10,000 in 10 Years

10-fold growth within a decade is rare but not unheard of. You can capture this growth either by predicting a…

Read more »

Growth from coins
Tech Stocks

Got $1,000? Buy These 3 Under-$20 Growth Stocks to Earn Higher Returns

These under-$20 growth stocks can deliver solid returns in the long run.

Read more »

Shopping card with boxes labelled REITs, ETFs, Bonds, Stocks
Tech Stocks

TFSA Investors: 3 TSX Stocks You’ll Regret Not Buying on the Dip

Among wide range of investments allowed in a TFSA, now is the time to invest in stocks.

Read more »

Tired or stressed businessman sitting on the walkway in panic digital stock market financial background
Tech Stocks

2 Stocks That Lost Over 50% in 2022

The recovery of the TSX’s tech superstar and a promising high-growth stock that lost more than 50% in 2022 is…

Read more »

Man holding magnifying glass over a document
Tech Stocks

Why BlackBerry Stock Looks Way Too Undervalued After Q1 Earnings

BB stock hasn’t seen any appreciation lately, despite its continued progress on the IVY platform and early signs of the…

Read more »

A stock price graph showing declines
Tech Stocks

BlackBerry Q1 Earnings: The Declining Revenue Streak Continues!

Will BB stock break below $6?

Read more »