For the past couple of years, the stock market hasn’t performed very strongly. As a result of the market’s poor performance, investors have seen the end of the most recent bull market. Fortunately, these conditions won’t last forever, and another bull market could be upon us sooner than anyone thinks. In that case, you’ll have wished you spent these days accumulating shares in top growth stocks as it could set you up for success in the long run. Here are two perfect stocks to buy today!
This is a great stock for all investors
If I could only suggest one growth stock to buy today, it would be Constellation Software (TSX: CSU). The reason I turn to this company, and not any other one, is because I think Constellation Software could fit in anyone’s portfolio regardless of what your situation may be. This is a bona fide blue-chip stock. Constellation Software is very well-established in its industry. As a result, its stock is much less volatile than other growth stocks. However, it can still outperform the market by a wide margin.
Looking at its stock performance in 2023 alone, investors can see a gain of 23.7%. That compares to the TSX, which has gained about 5.5% this year. The reason for Constellation Software’s outstanding sustained growth may be its dedication to staying ahead of its peers. For much of its history, Constellation Software has focused on acquiring small- and medium-sized vertical market software (VMS) businesses.
Today, it also includes large VMS businesses as acquisition targets, which could open a whole new avenue for growth. In fact, Constellation Software was in the news recently after it announced a spin out in order to fund a recent large VMS acquisition.
Constellation Software continues to be led by its founder and president, Mark Leonard. In my opinion, as long as Mr. Leonard is involved with this company, Constellation Software is a massive buy.
An exciting company for younger investors
If you’ve got a longer investment horizon, then I would suggest Shopify (TSX: SHOP) for your portfolio. The reason I think Shopify should be left for younger investors is because the company remains very volatile. The ecommerce industry is still growing at a fast rate and competition is fierce. Although I think Shopify will emerge as one of the market leaders over the next decade, any small bump in the road could lead to a significant decline in stock value.
This year, Shopify stock has gained about 25%. However, that comes off the back of a massive 80% decline in stock value. I do think Shopify could return to its previous all-time highs, but how long that takes is yet to be seen. Shopify’s business continues to grow at an impressive rate. Its Q4 revenue has increased 26% year over year.
Like Constellation Software, Shopify is led by its founder Tobi Lütke. I believe this is an important quality to look for in growth stocks, as founder-led companies tend to outperform peers led by non-founders. Until that changes, Shopify will be a stock that investors should buy and hold forever.
