The Canadian stock market has been through significant periods of ups and downs since the pandemic took hold of global economies. The ongoing vaccine rollout boosted investor confidence over the past several months, but rising concerns due to the Delta variant resulted in more instability.
One of the highlights for the Canadian stock market was the pivotal role that tech sector companies played in driving the growth for the TSX during 2020. Solid earnings, commodity prices, and economic growth saw most stocks from different sectors of the Canadian economy go through massive rallies in the first few months of 2021. However, many Canadian tech stocks went through pullbacks and volatility.
Despite the volatility, it is clear that finding the right high-quality assets and investing in technology stocks can provide investors with considerable returns for their investments. The period of difficulty for the tech sector provided many investors the opportunity to buy shares of high-quality companies at discounted prices.
Creating a diversified portfolio of assets can help you considerably improve your financial position in the long run. Today, I will discuss Lightspeed POS (TSX:LSPD)(NYSE:LSPD), a stock from the Canadian tech sector that could be a no-brainer buy for your investment portfolio.
Lightspeed POS stock’s strong revenue growth
Lightspeed POS has been one of the top growth stocks on the TSX since it made its debut on the TSX in March 2019, and has consistently provided stellar returns to its investors. The stock is trading for $105.23 per share at writing, representing gains of almost 457% since it became a publicly-traded company.
Lightspeed has managed to rapidly grow its revenue, with sales increasing from US$57 million three years ago in fiscal 2018 to US$221.7 million so far in fiscal 2021. Many analysts predict that the company’s revenue growth will rise as high as US$611.6 million by the end of fiscal 2023.
Strategic acquisitions
Lightspeed POS has enjoyed significant organic growth. The company’s focus on making strategic acquisitions has allowed it to increase its revenues further and expand its geographic reach. Including the two companies that Lightspeed POS acquired in June, the company has successfully acquired 13 companies in just two years.
The acquisitions of NuOrder and Ecwid have allowed Lightspeed POS to establish a strong presence in international markets while expanding its overall customer base.
Another crucial factor driving revenue growth for the company has been its payments and financing solutions through Lightspeed Payments. The payments processing solution is already available to its customers in the U.S. and Canada. The expansion of this solution to Australian and European markets presents more growth opportunities for the company that it has yet to realize, making it a company that has much more upside to offer.
Foolish takeaway
The growing demand for the services that Lightspeed POS provides to its customers and the overall digital migration of businesses due to the pandemic has opened up plenty of opportunities for the Canadian tech company to continue growing at a rapid pace for years to come.
If you are looking to build a diversified investment portfolio, the massive upside potential of Lightspeed POS stock could play a crucial role in helping you become a much wealthier investor in the long run.
