Investing in quality companies trading at a lower multiple is a proven strategy to generate outsized gains. In this article, I have identified two TSX stocks that are trading below all-time highs, making them attractive to value and growth investors.
Let’s see why you should buy the dip in these two growth stocks right now.
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Is this TSX stock undervalued?
In Q1 2025, Shopify (TSX:SHOP) grew its revenue by 27% year over year, despite mounting trade tensions and economic uncertainty. The company’s gross merchandise volume totaled US$74.8 billion, up 23% year-over-year, marking the seventh consecutive quarter of GMV (gross merchandise volume) growth exceeding 20%. Notably, 38 of Shopify’s 39 quarterly merchant cohorts since 2015 have outperformed the broader e-commerce market, highlighting the platform’s ability to drive superior merchant outcomes.
International expansion continued gaining momentum, with European GMV surging 36% and offline GMV increasing 23%. Shopify Payments penetration reached 64%, supported by expansion into 16 new markets, nearly doubling its geographic reach to 39 countries.
Management addressed tariff concerns head-on, rapidly deploying tools to help merchants navigate trade complexities. It launched enhanced Managed Markets products, duty calculation features, and tariffguide.ai within weeks of policy announcements. Cross-border GMV remained stable at 15% of total volume, with minimal exposure to China-related trade restrictions affecting only 1% of overall GMV.
Shopify’s merchant base is diverse across industries and geographies, providing natural insulation against sector-specific disruptions. More than half of U.S. buyers have incomes exceeding US$100,000, offering additional resilience against potential price sensitivity.
Management emphasized that legacy commerce platforms are struggling with basic operational tasks, creating migration opportunities for Shopify’s more agile infrastructure.
Shopify’s growth story is far from over as analysts expect sales to rise from US$8.9 billion in 2024 to US$23.3 billion in 2029. Comparatively, free cash flow is projected to increase from US$1.6 billion to US$5.2 billion in this period.
If the TSX tech stock is priced at 50 times forward FCF, which is below its current multiple of almost 80 times, it should trade at a market cap of US$260 billion in early 2029, indicating an upside potential of 63% from current levels.
Is this TSX dividend stock a good buy?
In Q1 2025, Brookfield Renewable Partners (TSX:BEP.UN) grew its adjusted funds from operations (FFO) by 15% year over year despite a challenging macro environment. The company’s globally diversified portfolio of nearly 45,000 megawatts insulates it against trade disruptions.
Management emphasized that recent U.S. tariff announcements have limited impact on their business due to proactive domestic sourcing strategies and locked-in equipment costs for most advanced-stage projects.
Approximately 60% of its 29.8 gigawatts of North American advanced-stage development consists of U.S. solar projects with equipment already secured.
Domestic focus
Brookfield’s strategic shift toward domestic U.S. suppliers in recent years has reduced exposure to Asian equipment tariffs. The firm’s scale and established relationships with Tier 1 suppliers globally provide flexibility to source equipment across geographies, benefiting from lower costs in non-U.S. markets as suppliers redirect inventory.
Brookfield’s partnership with Microsoft continues to expand beyond the initial 10.5 gigawatt framework agreement, with management expressing confidence in additional corporate partnerships materializing in 2025. The persistent supply-demand imbalance in power markets supports the company’s ability to pass through any tariff-related cost increases while maintaining competitive pricing.
Brookfield deployed US$4.6 billion in acquisitions during the quarter, including the completion of the Neoen privatization and the agreement to acquire National Grid Renewables. These transactions strengthen Brookfield’s development pipeline while providing opportunities for value creation through accelerated development timelines and asset optimization programs.
Analysts tracking the TSX dividend stock estimate adjusted FFO to grow from US$1.69 per share in 2024 to US$2.25 per share in 2027. A widening FFO base should enable Brookfield to increase its dividend per share from US$1.42 in 2024 to US$1.71 in 2029.
If BEP stock is priced at 15 times forward AFFO, it should trade around US$34 in early 2027, indicating an upside potential of 26% from current levels. If we adjust for dividends, cumulative returns could be closer to 35%.
