As the TSX Index attempts to stage a bit of a relief bounce after falling alongside the S&P 500 this March, questions linger as to which list of tariffs will end up sticking. Undoubtedly, broad-sweeping 25% tariffs could drag the TSX Index into correction territory alongside the U.S. indices.
That said, with investors feeling just a bit more hopeful that the worst and broadest of tariffs can be avoided (at least for now), it seems like this oversold market may have the means to regain some of the ground it lost in recent weeks. Indeed, for the TSX Index, which only fell around 5%, rather than the 10% plunge of the S&P 500, the markdowns on stocks are relatively modest. Still, there are a few individual names out there that remain oversold and could have a bit more upside as we head into the midpoint of 2025.
So, whether we’re bound for higher highs or a revisiting of 52-week lows (Trump tariff volatility is probably far from over), the following name looks worthy of adding to one’s radar for the rest of the year. And if you’ve got room in a TFSA (Tax-Free Savings Account), perhaps the following stock could make for the top candidate.
Source: Getty Images
Shopify
Shopify (TSX:SHOP) stock has been on a rough patch, sliding 27% from its 52-week highs, entering bear market territory alongside a large number of high-flying tech names that fell back to Earth on tariff uncertainty. Indeed, the artificial intelligence (AI) and tech trade was overheated going into the year, making a correction more than necessary. In the case of Shopify, I view the nearly 30% drop as overdone, especially given the company’s long-term growth opportunity and massive total addressable market it could go after with a bit of AI “magic” by its side.
Recently, the company released an intriguing new feature that allows customers to set up and design their digital storefronts using generative AI. Indeed, Shopify is using the technology to really supercharge smaller businesses as they look to take on much larger rivals. In prior pieces, I’ve praised Shopify as an AI stock. The latest descent, I believe, missed the AI opportunity entirely for headwinds (from tariffs) that I view as mostly transitory.
Though SHOP shares rebounded around 4.7% on Monday’s relief rally session, I still view the stock as a fantastic deal for Canadian investors seeking growth at a reasonable price. As the stock moves from the NYSE to the Nasdaq, perhaps U.S. tech investors will be inclined to give the Canadian e-commerce titan a bit more respect.
At the time of this writing, shares of SHOP trade at a seemingly pricey 68.9 times trailing price-to-earnings (P/E) multiple. While more downside could be ahead if tariff talks accelerate, I’d not be afraid to set in as a buyer should the stock drop markedly below $155 per share — close to where the name is trading today after Monday’s magnificent bounce in the broader market.
