Shopify (TSX:SHOP) is the one stock that just won’t quit holding investor interest. Yet whether that’s good interest or bad is very much up for debate. Shopify stock continues to bounce up and down like a yo-yo, with shares now down 11% in the last year, plunging near 52-week lows.
Even with that drop, the valuation still looks high at 98 times earnings at writing. So while Shopify stock is a world-class business, investors might have missed out on the big bucks, and instead may need to consider another tech stock instead.
Source: Getty Images
What happened
Before we get to that other company, let’s look at what’s been going on with Shopify stock. For those who aren’t aware, Shopify stock is the Ottawa-based commerce platform that helps businesses sell online, in stores, across social media, and through other digital channels. In short, it gives small businesses and major brands the tools to run modern commerce without building all that technology themselves.
Over the last year, Shopify pushed artificial intelligence (AI) tools deeper into the platform, including Sidekick and integrations with major AI assistants. And the latest earnings showed it gained some momentum. In Q1 2026, gross merchandise volume rose 35% to US$100.7 billion. Revenue increased 34% to US$3.2 billion, and free cash flow came in at US$476 million, with another quarter of 30%-plus revenue growth.
The catch is that investors already know Shopify is an outstanding stock, and that creates a high bar. After Q1 earnings, the stock still fell because investors wanted a stronger forecast and worried about rising AI-related spending. Operating expenses climbed as Shopify stock invested heavily in product development and AI. So, while Shopify stock remains a premium Canadian growth stock, it no longer offers the same asymmetry it once did.
ENGH
Enghouse Systems (TSX:ENGH) is the smaller, much less glamorous candidate. The Markham-based company develops enterprise software for contact centres, video communications, networks, transportation, public safety, and asset management. It doesn’t have Shopify stock’s rocket-ship growth, but it does have a long history of profitability, acquisitions, and dividends.
The latest numbers weren’t exciting, but profitable. In Q1 fiscal 2026, revenue fell 3.1% year over year to $120.1 million. Net income came in at $17.5 million, or $0.32 per diluted share, down from $21.9 million, or $0.40 per share, a year earlier. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $31.1 million, down from $33.1 million. Still, the adjusted EBITDA margin remained strong at 25.9%.
The valuation is where the asymmetry becomes more interesting. ENGH recently traded at just 13.2 times earnings, with a dividend yield at a whopping 7.4%. Yes, a tech stock with a high yield. That gives investors income while they wait for a turnaround. Now of course, revenue needs to stabilize, and acquisitions need to create growth again. But expectations look low. Meanwhile, even $7,000 can bring in strong income.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | ANNUAL DIVIDEND | ANNUAL TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| ENGH | $16.80 | 416 | $1.24 | $515.84 | Quarterly | $6,988.80 |
Bottom line
Shopify stock remains the Canadian tech champion for good reason. Its merchants processed more than US$100 billion in one quarter, and revenue keeps growing at a stunning pace. But the stock’s valuation leaves less room for error.
Enghouse offers a very different setup: slower growth, a cheaper valuation, strong cash, steady profitability, and a large dividend. It won’t become the next Shopify stock overnight, but for investors hunting for asymmetry before the crowd returns to smaller Canadian software stocks, ENGH looks worth a closer look.
