The market has been on a heck of a hot streak, with various technology firms (many of which were bruised badly last year) climbing steadily higher over the past few months. Indeed, many beginner investors may be kicking themselves, asking why they did not buy when markets were at their lows just over half a year ago. Doing such is not constructive.
Remember, nobody can tell where Mr. Market is headed over the near term, especially in the face of significant macro risk. As such, you should forgive yourself and focus on the path ahead. With the U.S. Federal Reserve in the midst of a hawkish pause (it did note that the fight with inflation is not over quite yet), with the door open for more rate hikes over the coming quarters, investors must think longer term and not overreact to any near-term fluctuations on the rates of the 10-year Treasury note.
Top tech stocks like DCBO and SHOP stock are worth watching and nibbling!
At the end of the day, big money is made over extended time horizons. Though I believe hot stocks, specifically in the tech scene, are long overdue for a near-term pullback, I’d get the dry powder ready so you’ll be able to be a buyer in what may be a “second chance” to get in top tech names at reasonable multiples.
For now, though, investors should be careful when chasing hot tech stocks, as value seems somewhat trickier to find. Be more selective and be ready to buy on a pullback, and you need not worry about what the “Fed heads” are up to as they speak to the public.
Let’s consider Shopify (TSX:SHOP) and Docebo (TSX:DCBO), two growth-heavy TSX stocks to watch as they come in as a part of a broader market “cool off.”
Shopify stock
Shopify stock is getting a tad too hot to handle, at least in my books. The stock is up over 30% since its latest quarter. Though there has been choppiness since the upward spike, I think current shareholders need not trim.
Has the stock gotten a bit ahead of itself?
Perhaps a bit. However, the stock may still have room to run, as it looks to walk the walk after talking the talk. Indeed, Shopify has levers to pull to revamp growth, even in a sluggish economy.
With that, I’d not underestimate the capabilities of the brilliant Chief Executive Officer Tobias Lütke. As for adding to a position, why not wait for a correction? Personally, I’m waiting for the stock to come in before I throw new money at it. I think value investors would be wise to follow suit. For now, I view Shopify stock as a worthy hold. If shares fall below $75, I’d give it another look.
Docebo stock
Docebo stock hasn’t been nearly as hot as the likes of Shopify stock. That said, the recent run off lows is still remarkable, especially as remote (or hybrid) work sticks around with various employers who are in no rush to mandate employees to get back to the office.
Of course, many will need to return to the office. But a great deal of folks have adapted to the future of remote work. And with that, demand for Docebo’s learning suite could stay relatively robust.
Up just 6% year to date, I think Docebo stock is a great addition to any value-conscious growth portfolio.
