There’s no shortage of discounted tech stocks to choose from on the TSX right now. Long-term investors who are willing to be patient would be wise to consider loading up on a beaten-down tech stock or two today.
Discounts in the tech sector
The tech sector has experienced all kinds of highs and lows over the past five years. Quickly following the COVID-19 market crash, the tech sector went on an incredible bull run. However, that was then followed by a very disappointing year where many tech stocks plummeted to pre-pandemic prices.
The sector finally began gaining momentum in 2023, but many tech stocks still trade far below all-time highs, many of which were last set in late 2021.
In the short term, the tech sector may carry too much risk for investors. It’s anybody’s guess as to how the volatile sector will perform in the coming months. But for those with time on their side, there are too many good deals to pass up on right now.
I’ve reviewed two discounted techs that I already own and will likely add to while these prices last.
Shopify
Canadian investors should not ignore this buying opportunity.
It wasn’t long ago that Shopify (TSX: SHOP) was the largest stock, based on market cap size, on the TSX. Today, the $100 billion company is down more than 50% from all-time highs and trading not much higher than where it was in early 2020.
Despite the recent volatility, though, Shopify has still doubled the returns of the S&P/TSX Composite Index over the past five years.
Like many other tech companies, Shopify couldn’t avoid the pandemic’s negative impacts. Huge amounts of growth were pulled forward, which strained the business and ultimately led to significant layoffs.
While the stock may still be a ways away from all-time highs, there’s a lot to be bullish about in the long term.
Shopify owns a top market position in the e-commerce space and is only continuing to strengthen its global position.
If you’re looking for a tech stock with loads of market-beating growth potential in front of it while also trading at a discount, Shopify is the company for you.
Lightspeed Commerce
Investors may need to be a bit more patient with this $2 billion company.
Shares of Lightspeed Commerce (TSX: LSPD) are down close to 80% below all-time highs. The tech stock is now trading at roughly the same price as when the company went public in 2019.
Despite the stock being in a downward spiral for almost three years now, I believe there’s a serious long-term value play here.
Lightspeed maintains an international presence in the commerce space, offering its global customers a range of different products and services to choose from.
In addition, revenue growth continues to come in in the double-digit range. Investors also seem to be pleased with management’s recent commitment to profitability.
It likely will be a while before this growth stock is back to all-time highs. But if you’ve got the time horizon that allows you to be patient, this is a company that’s worth taking a chance on.
