All those seemingly expensive tech stocks are really starting to come in, with the S&P 500 fresh off two of its worst days since the 2020 COVID crash. Indeed, it’s been a long time since stocks were in free-fall like this. And while various tech stocks on the TSX Index may still have more room to the downside as we learn more about the longer-term implications of Donald Trump’s tariffs, I think that long-term growth investors with 10-year horizons or more may wish to start deploying some cash.
Whether it’s $1,000 or $7,000, now seems like a good time as any to start doing some buying while the fear gauge is off the charts. In this piece, we’ll check in on two former high-tech market darlings that have soured in a big way. Indeed, their shares have been on a relatively slow and steady descent for quite some time now, even before Trump took his tariff threats to the next level with his so-called Liberation Day. Indeed, I have no idea when the Liberation Day hangover will end.
Liberation Day brings forth selling panic.
Either way, I’d get ready to roll up the sleeves and start thinking about growth companies to buy while they’re well off their highs. Sure, the TSX Index has not gone unscathed since the Liberation Day selling panic struck the hearts of investors, shedding close to 5% of its value on a frightening Friday. Of course, it’s easy to be paralyzed in fear, with dread of the bloodbath that could be to come in the next week.
But it’s times like these, when others around you are either too scared to put money to work in plunging stocks or lack the liquidity to pick up the biggest bargains thrown into the discount bin, that the best of deals tend to be landed by contrarian investors. Indeed, rotating to safety plays is never a bad idea, especially if you’re 50 or older. However, if you’re only in your 20s or 30s starting your career, this stock market sell-off should be an opportunity to get more for your dollar. Of course, don’t do all of your selling at once, especially if we’re in for a year-long (or perhaps longer?) ride into the seemingly endless abyss.
Consider shares of Shopify (TSX:SHOP), which is reeling after last week’s horrendous selling spree.
Shopify
Shopify stock sagged 5.5% last Friday, accelerating the sell-off that may very well drag shares below the $100 level. Indeed, SHOP stock is now off more than 40% from its 52-week high. And while the past year of gains could be wiped out tomorrow, I’d be inclined to be a buyer if you’re willing to stick around for the next 10 years. Young investors should embrace the e-commerce titan as it levels up its AI game.
Indeed, Shopify and the rest of tech are going to be busy incorporating AI to boost margins, sales, or both. And while it could take three years or so for the real AI agent catalysts to kick in, I think it’s an unwise time to sell while everyone is horrified by tariffs. Can Shopify fall further? Most definitely. But if you can ride this downward wave out, the potential for longer-term gains could prove outsized.
Personally, I think AI stocks, like Shopify, are a bargain. But you’ll need courage to brave this dip.
