2 Cheap Tech Stocks to Buy Before 2022

Consider investing in these cheap tech stocks for this December, as the holiday season closes in.

| More on:
edit Sale sign, value, discount

Image source: Getty Images

At writing, the S&P/TSX Composite Index is up 17.18% year to date, but the Canadian benchmark index has been on a downturn since November. The index is down by 5.65% from its all-time high in November 2021, and the TSX boasts several high-quality stocks trading for a bargain today.

Investing in technology has proven itself to be one of the hottest trends for Canadian stock market investors in recent years. The tech sector’s performance has been lacklustre in 2021 compared to its 2020 gains. But the industry is undoubtedly becoming bigger each year and has plenty of upside potential to offer Canadian investors who can identify and capitalize on the right opportunities.

Today, I will discuss two ridiculously cheap Canadian tech stocks that you could consider adding to your portfolio at current levels. Read about them to determine whether they are bargains that can offer substantial long-term wealth growth or stocks you should avoid.

Enghouse Systems

Enghouse Systems (TSX:ENGH) is a Markham-based $2.50 billion market capitalization company that designs software for various business verticals worldwide. For instance, the company’s Interactive Management Group business specializes in software that facilitates the remote work culture dominating the workforce today. It is no surprise that shares of this tech company skyrocketed during 2020.

2021 has been an entirely different picture for the tech stock. At writing, Enghouse stock is trading for $44.99 per share, and it is down by over 27% year to date. The company could present plenty of short-term upside for investors if the company chooses to sell part of its business. Analyst consensus has given the stock a price target of $63 over the next 12 months.

Absolute Software

Absolute Software (TSX:ABST)(NASDAQ:ABST) is a Vancouver-based $583.90 million market capitalization company that specializes in endpoint security, helping its clients protect their data and devices. Like Enghouse Systems, business boomed for Absolute Software during 2020 due to the surge in demand for its services. However, the stock peaked in early 2021 and has been on a downturn ever since.

At writing, Absolute Software stock is trading for $11.72 per share, and it is down by over 43% from its February 11, 2021, high. Despite the tough time it is facing, the company boasts an edge over its competition through Endpoint Resilience, the only undeletable defence platform in the industry. Market analysts forecast the share prices for the stock to climb to $18.90 in the next 12 months.

Foolish takeaway

As we inch closer to 2022, the stock market is becoming increasingly problematic for many investors. However, investors who can identify these conditions as an opportunity to purchase high-quality stocks for a bargain can find assets that could provide them with stellar shareholder returns when the market eventually recovers.

Absolute Software stock and Enghouse Systems stock could be two excellent investments to consider adding to your portfolio for this purpose.

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 Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns and recommends Enghouse Systems Ltd. The Motley Fool recommends Absolute Software Corporation.

More on Tech Stocks

Shopping and e-commerce
Tech Stocks

Can Shopify Recover to New All-time Highs in 2022?

With more than 1.7 million merchants on its platform, Shopify (TSX:SHOP)(NYSE:SHOP) is undoubtedly a core platform for SMBs. The company’s software-as-a-service platform …

Read more »

Businessman holding tablet and showing a growing virtual hologram of statistics, graph and chart with arrow up on dark background. Stock market. Business growth, planning and strategy concept
Tech Stocks

The 5 Best High-Growth TSX Stocks to Buy on the Dip

The broader market selling, primarily in high-growth stocks, provides a solid opportunity for investors to buy future winners at lower …

Read more »

Coronavirus written newspaper close up shot to the text.
Tech Stocks

The 2 Best Tech Stocks to Buy Today for Low-Risk Investors

Overvalued tech stocks are undergoing a major correction after inflating on the back of high liquidity from fiscal stimulus packages. …

Read more »

Choose a path
Tech Stocks

Is Ripple Primed for 100% Growth in 2022?

From an investment perspective, most cryptocurrencies seem similar. Almost all of them seem volatile, and while some get more limelight …

Read more »

Tech Stocks

Tech Crash: 2 Tech Stocks Analysts Have Sliced in Half

The TSX has continued to wax and wane over the past week. After a huge fall on Monday, shares started …

Read more »

Hand holding smart phone with online shop concept on screen
Tech Stocks

Shopify Stock Selloff: Could it Turn Around in February?

Shopify (TSX:SHOP)(NYSE:SHOP) continues to be one of the worst-affected stocks amid the ongoing market selloff. After posting its worst weekly …

Read more »

analyze data
Tech Stocks

TFSA Investors: Is the Tech Crash Over?

It’s been a hard time for Tax-Free Savings Account (TFSA) investors already in 2022. Almost immediately after ringing in the …

Read more »

value for money
Tech Stocks

4 Cheap TSX Stocks to Buy Under $50

The recent selloff in equities has led to a sharp pullback in high-quality TSX stocks. Many of these Canadian stocks …

Read more »