It continues to astound me as to why shares of Lightspeed Commerce (TSX: LSPD) have remained unchanged for about a year and a half now. It’s craziness, with shares hardly moving from around $25 per share. And yet, here we are.
Honestly, though, this share price is one that cannot possibly last, which is why now is the time I would take advantage of this low share price. And here are three reasons why.
Innovation
Lightspeed stock continues to announce more product innovations for its clients. Those merchants are large and even enterprise-level businesses, bringing in substantial revenue. So, it’s clear why Lightspeed stock wants to keep them happy.
Most recently, this included a combination of new product features and upgrades to support its retail and hospitality customers. First, it offered clients unified payments, with the goal of achieving 50% of clients using the payments solution in the next year and a half. However, it also rolled out more upgrades to help improve both speed and efficiency.
The upgrades include its Tableside solution, Lightspeed Retail and NuORDER Order Integration — all would help businesses scale the business easily. The key is making its merchants happy, many of which continue to use legacy systems that are making it harder to interact with potential customers and keep up with payments.
Earnings keep coming
Investors must be frustrated (and we are) with all these announcements on top of strong earnings again and again. This included the last quarter, which beat revenue forecasts and helped the company achieve positive earnings before interest, taxes, depreciation, and amortization (EBITDA).
Total revenue during the second quarter climbed a whopping 25% year over year, with more than US$230 million. This passed its outlook of between US$210 and US$215 million. Furthermore, while it still posted a loss, the company was able to achieve positive EBITDA. This helped post a $200,000 profit, again beating the expected $4 million loss.
Basically, management is keeping up with its promises. And it’s doing so conservatively. Yet after US$2 billion in acquisitions just a few years ago, it’s certainly going to hit profitability this year. Even the next quarter.
More to come
Now, earnings are around the corner. At the very least, Lightspeed stock should see a bump in share price, even if it’s only temporary. As it stands, investors seem to be standing on the sidelines until the overall market and tech stocks improve dramatically.
But those investors are likely going to miss out on the large opportunity that sits before them. Lightspeed stock is likely to see a massive turnout when both United States and Canadian interest rates come down. This is what the company has identified as holding back its clients.
When clients no longer have that worry, they will likely seek new ways of capturing customers. And Lightspeed stock could certainly be the answer. So, make sure to watch this stock, at the very least. As for me, I’ll be picking it up again and again as we continue to see such valuable share prices.
