Now Is the Time to Add These 3 Stocks to Your TFSA Portfolio

The sharp pullback in fundamentally strong TSX stocks presents a solid opportunity for buying.

| More on:
TFSA and coins

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

The record-high inflation, rising interest rate environment, and fear of an economic slowdown have led to a selloff in stocks. Thanks to the recent selling in the equity market, several top TSX stocks are trading at a significant discount from their 52-week high. This represents a solid opportunity for investors with a Tax-Free Savings Account (TFSA) to load up on growth stocks to surpass the market averages in the long term and accumulate wealth.

Against this background, let’s look at a few stocks that could be a valuable addition to your TFSA portfolio. 

Docebo

Let’s start with Docebo (TSX:DCBO)(NASDAQ:DCBO). Shares of this AI-powered corporate e-learning platform provider are down about 63% from their peak and trading close to the 52-week high. The moderation in its growth rate amid a deteriorating economic environment led investors to dump Docebo stock. 

Docebo is up against tough comparisons. Thus, a slowdown in the growth rate shouldn’t surprise much. While Docebo’s growth moderated, it still managed to grow annual recurring revenue by 55% in Q1, which is impressive. Further, Docebo’s key performance metrics remain strong, including consistent growth in customer base, higher average contract value, and an increase in multi-year contracts. 

Overall, the significant correction in Docebo’s stock price and its growing enterprise customer base is why investors should add its stock to their TFSA portfolio. Furthermore, its land & expand strategy, new product launches, geographic expansion, and opportunistic acquisitions bode well for growth and will likely support a recovery in its stock price. 

Shopify  

Near-term macro headwinds, tough comparisons, the reopening of physical retail, and overall negative investors’ sentiment on tech stocks wiped out Shopify’s (TSX:SHOP)(NYSE:SHOP) pandemic-led gains. Shopify stock has fallen nearly 80% from its highs, while its valuation is at a multi-year low. This massive correction in Shopify stock, despite the company’s strong fundamentals, provides an excellent buying opportunity for investors. 

Notably, concerns around consumer spending could continue to play spoilsport in the short term. However, Shopify’s long-term fundamentals remain intact. Further, it remains on course to benefit from the strong business investments, growing market share, product expansion into new geographic markets, and acquisition of new merchants. 

The strong adoption of its payments offerings, strengthening of fulfillment network, partnership with top social media companies, and ongoing digital suggest that Shopify stock could recover fast as economic headwinds ease. 

goeasy 

goeasy (TSX:GSY) stock has been a top wealth creator for years. The company offers leasing and lending services and targets subprime borrowers. It has consistently delivered stellar revenue and earnings growth and has enhanced its shareholders’ value by rapidly growing its dividend.

Amid the recent selloff, goeasy stock has lost more than 50% of its value. However, what stands out is that goeasy continues to grow its financials at a breakneck pace. 

Higher loan volumes, increase in ticket size, omnichannel offerings, and new product launches will likely drive its top line. Meanwhile, increased penetration of secured loans, strong credit and payment volumes, and improving efficiency will cushion its bottom line and dividend payments. 

goeasy strong growth profile, continued strength in the business, and the pullback in price make it an attractive investment for your TFSA. 

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Shopify. The Motley Fool recommends Docebo Inc.

More on Tech Stocks

STACKED COINS DEPICTING MONEY GROWTH
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 »

A bull outlined against a field
Tech Stocks

After the Recent Fall, it’s Time to Turn Bullish on 2 TSX Growth Stocks

With the kind of lows these TSX stocks have seen, the negatives appear to be priced in.

Read more »

man sitting in front of 3 screens programming
Tech Stocks

3 Ultra-Cheap Tech Stocks to Consider Buying

Three ultra-cheap tech stocks are interesting picks for their favourable business outlooks and long growth runways.

Read more »