After a sudden pullback at the start of April earlier this year, the Canadian stock market has been on fire ever since. The S&P/TSX Composite Index is up close to 20% since the first week of April, putting the index up more than 5% on the year.
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Investing in tech stocks
For investors looking to put some money to work today, the tech sector could be a great place to start.
Whether you’re looking for a dependable market-beater or the next multi-bagger, there’s a tech company for you that can provide your portfolio with market-beating growth potential.
With that in mind, I’ve put together a well-rounded basket of three Canadian tech stocks. While the basket may heavily index toward the tech sector, each of the stocks varies in terms of risk and growth potential.
If you’re looking to add some long-term growth potential to your portfolio, I’d have these three companies on your radar.
Shopify
It wasn’t all that long ago that Shopify (TSX: SHOP) was the largest company on the TSX. However, with shares still trading below all-time highs from 2021, Shopify has long since relinquished its spot as the largest company in the country.
Shares might be down 30% from all-time highs, but that doesn’t mean Shopify hasn’t returned to its market-beating ways. The tech stock is up a market-beating 50% over the past year and close to 100% over the past two years.
Shopify wasn’t the lone tech stock that saw its stock price plummet in 2022. The sector as a whole is still largely recovering from the 2022 sell-off that began in late 2021.
With plenty of runway still ahead for Shopify, now could be an incredibly opportunistic time for a long-term investor to start a position in the company.
I’d be prepared for more volatility, but that’s the price to pay for a chance at earning market-crushing returns.
Lightspeed Commerce
Just a few years ago, Lightspeed Commerce (TSX: LSPD) was one of the hottest stocks in the country.
Today, there are plenty of question marks around what the company will look like in the next three to five years.
The fact remains that Lightspeed has an international presence in the growing commerce space, offering its customers a range of different products and services to choose from. Revenue growth continues to be in the double-digit range but nowhere near the rate that investors were seeing just a couple of years ago.
What makes Lightspeed an intriguing buy today is its price. At $15 a share, the stock has been beaten down from its 2021 all-time highs and is now below the price at which it joined the TSX.
If you’re looking for a low-risk, high-reward type of growth stock, Lightspeed is for you.
Descartes Systems
To balance out this basket, I’ve included a steady market-beating growth stock that has also found itself trading at a discount.
Shares of Descartes Systems (TSX: DSG) are down 20% from all-time highs that were set earlier this year. Even so, the stock is up a market-beating 100% over the past five years.
This is the type of growth stock for investors who are searching for market-beating growth potential but also trying to minimize risk and volatility.
