Younger investors looking to kickstart their way to a nice, potentially early retirement with their TFSA (Tax-Free Savings Account) portfolios shouldn’t shy away from risk assets. There is no doubt that we live in rather perplexing market times.
We’re coming off nasty pandemic conditions (technically, the world is still in a pandemic), with lingering inflation, and a more hawkish central bank that’s keen on crushing the recent wave of unacceptable price increases.
Everything from bread to gas to rent has shot up to absurd levels in just a few years. Though higher rates (the ammunition that the Bank of Canada is using to combat “sticky” and problematic levels of inflation) could take a bit out of the earnings power of firms, many pundits would argue that rate hikes are a necessary albeit bitter medicine for the economy to recover form an unprecedented period.
Turbulent times for TFSA investors
There’s fear that a recession in Canada will hit. It may be a soft landing, or it may not be. If it isn’t, TFSA investors had better be prepared, with some sort of Plan B for when volatility makes a big comeback. Undoubtedly, we spent 2022 in an ugly spot.
As it turned out, buying the bear market was a wise move. And those who bought the dip in tech were rewarded with rather swift gains, thanks in part to easing rate-hike fears and red-hot large language model (LLM) ChatGPT.
Dismiss artificial intelligence (AI), ChatGPT, and its like as some sort of bubble, if you will (we’ve had quite a few bubble bursts over the past few years), but I still think TFSA investors who stay in their lane can make money without steering their TFSA retirement plans off course.
In this piece, we’ll look at one AI-savvy technology stock that may be a hidden gem on the TSX.
Docebo: Skin in the AI game!
Docebo (TSX:DCBO) is a software company in the niche LMS (learning management system) space. The company made huge strides in the tech-driven training field over the past few years.
Amid the worst of the pandemic, Docebo stock shot up, as work-from-home solutions saw the wind really hit their back. Fast forward to today, and the pandemic-era hype in Docebo stock has mostly dissipated. The stock is now down around 56% from its 2021 peak.
Though remote work isn’t nearly as powerful as it used to be, I still think many folks are discounting the company’s ability to thrive in a hybrid work environment. Further, the company has embraced AI tech to help further enrich its offering. Recently, the company added to its AI powers by acquiring learning tech company Edugo.AI. It’s an intriguing deal that investors shouldn’t ignore.
At a mere 8.35 times sales, DCBO stock is a firm that can benefit from the continued rise of AI. For now, the $1.6 billion company doesn’t get as much attention as I believe it deserves.
The Foolish bottom line for young, growth-focused TFSA investors
Docebo’s high-momentum days may be over. But there’s still room to run. The stock is up a modest 4.3% year to date. If investors start viewing Docebo as more of an AI beneficiary, I think shares could pick up the pace. For now, it’s a risk-on play worth considering if you’re young and in search of growth.