Long-term investing is a strategy whereby investors buy stocks and hold them for years to maximize their returns while mitigating short-term risks. Here are three top Canadian stocks that offer long-term growth potential and are available for less than $20 per share.
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Lightspeed Commerce
Lightspeed Commerce (TSX:LSPD) offers omnichannel commerce solutions to enterprises, helping them scale their businesses, connect with suppliers, and transact through its payment solutions. Last month, the company posted impressive fiscal 2024 third-quarter earnings, with its revenue growing by 27% to $239.7 million. Supported by new product launches and venturing into new markets, the company expanded its customer base and grew ARPU (average revenue per user), thus driving its financials. Also, its Unified Payments initiative increased its GPV (gross payment value) as a percentage of GTV (gross transaction value) to 29%.
Along with top-line growth, the company’s adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) improved from a loss of $5.4 million in the previous year’s quarter to profits of $3.6 million. It was also higher than management’s guidance of $2 million. All tallied, the company ended the quarter with cash and cash equivalents of $749.4 million, so it is well-equipped to fund its growth initiatives.
With the increased adoption of the omnichannel selling model, the demand for Lightspeed Commerce’s products and services is growing. Meanwhile, the company is launching new products and expanding its payment platform to new markets. Currently, LSPD stock trades at two times analysts’ projected sales for the next four quarters, which looks cheap compared to its growth prospects.
Savaria
Savaria (TSX:SIS) offers accessibility solutions to the physically challenged, improving their comfort and mobility. Earlier this month, it reported impressive 2023 performance, with its top line growing by 6.1%. Solid organic growth and favourable currency translation drove revenue, while the divestment of its Norway operations offset some of it. Boosted by top-line growth, its adjusted EBITDA increased 8.2% to $130.1 million.
Meanwhile, the demand for the company’s products is rising amid an increasing aging population, income levels, and government investment in healthcare infrastructure. Given its wide range of product offerings, global production facilities, and worldwide dealer network expansion, the company is well-positioned to benefit from market expansion. Also, the improving synergies with Handicare, which Savaria acquired in 2021, could support its financial growth.
Looking forward, Savaria’s management projects its 2025 revenue to cross $1 billion, representing annualized growth of 9.3%. The company also pays a monthly dividend of $0.0433/share, with a forward yield of 3.03%. Its NTM (next 12 months) price-to-sales multiple stands at 1.4. Considering all these factors, I am bullish on Savaria.
BlackBerry
My final pick would be BlackBerry (TSX:BB), which offers intelligent cybersecurity software solutions and services to governments and enterprises worldwide. Over the last few months, the company has been under pressure due to lower-than-expected growth in its IoT (Internet of Things) segment and weaker fiscal 2024 guidance. It has lost over half its stock price compared to its 52-week high. Amid the weakness, the company trades at 1.9 times its book value, which looks attractive.
However, increasing awareness about vehicle safety has increased the demand for the Advanced Driver Assistance Systems platform, thus creating a multi-year growth potential for BlackBerry. Further, the growing popularity of connected and autonomous cars could also support its growth, given its IVY platform, which collects, analyzes, and monetizes data. Besides, its expanded product offerings in the cyber security segment and blue-chip customer base could stabilize its financials. So, I believe BackBerry’s discounted stock price offers an excellent entry point for long-term investors.
