Tech stocks play an important part in any investor’s portfolio. These days the technology industry is one of the best places to find stocks that can power your portfolio to years of growth.
As technology continues to get faster, telecommunications better, and consumers’ attention spans shorter, convenience is huge. It’s why fast food sales have been rising for decades. People love their leisure time and when they want goods and services, they want them now.
So while e-commerce and the overnight shipping industry that’s been created as a result is no longer new, it’s rapidly increasing in popularity, which is why Shopify stock still has a long road of growth potential ahead.
At the same time, with all this new and improved technology and millions of ways you can use the internet, such as to power a robot vacuum or turn on your barbeque, software security is also crucial.
It’s an industry that will only continue to grow in volume and importance, which is why BlackBerry stock also has so much long-term growth potential.
So you may be wondering, of these two highly popular Canadian stocks, which is the better buy today?
BlackBerry vs. Shopify stock
Although many investors are bullish on BlackBerry’s long-term potential, the company is nowhere near as successful as Shopify.
In the past three years, Shopify’s sales have grown by more than 4.5 times. BlackBerry’s sales, on the other hand, have declined about 5%. The two companies couldn’t be in more different positions.
With Shopify, you get a rapidly growing stock that will likely see a slowdown in growth over the years but still continue to its business expand for decades.
On the other hand, BlackBerry is a stock that has most of its potential down the road in the future. It doesn’t offer nearly as much growth potential today and is a significantly higher-risk investment.
And while software security is going to only continue to gain importance, BlackBerry faces some stiff competition.
One of the reasons why BlackBerry stock has been so popular is due to the rapid rallies it’s seen already this year. Investors saw the potential for BlackBerry stock to grow rapidly.
This could, of course, happen again. However, making an investment because you are hoping that it happens again is highly speculative and extremely risky.
So rather than speculate on short-term price movements, I would look at which stock offers more long-term potential. Investors have been interested because BlackBerry stock gained over 200% in a matter of weeks back in January. Meanwhile, Shopify stock has earned investors a more than 4,500% return over the last five years.
So clearly, investing for the long term has far more potential. And when you can find one stock to buy and hold, it’s considerably easier than buying and selling stocks constantly, always looking for short-term gains.
Both Shopify and BlackBerry stock offer serious growth potential over the long run. Because there aren’t any catalysts for BlackBerry at the moment, though, and the stock has been prone to speculation lately, Shopify looks like the better buy today.
Having said that, Shopify stock is trading at its all-time high right now, so you may want to see if you can buy this top Canadian growth stock at a discount the next time it pulls back.
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 Daniel Da Costa has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Shopify. The Motley Fool recommends BlackBerry and recommends the following options: long January 2023 $1,140 calls on Shopify and short January 2023 $1,160 calls on Shopify.