Shopify Stock vs. Lightspeed Stock: What’s the Better Buy?

Shopify is the proven winner with faster growth and real cash generation, but investors must pay a premium for that quality.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published May 26, 4:00 pm EDT

| More on: TOSTLSPDSHOP

Key Points

Shopify is scaling into commerce infrastructure with strong revenue growth, huge GMV, and meaningful free cash flow.
Lightspeed is cheaper and improving, but it still has losses and must prove its turnaround and cash-flow targets.
For most long-term investors, Shopify looks like the safer buy, while Lightspeed is the higher-risk rebound bet.

10 stocks we like better than Toast

Canada’s tech stocks can move fast. Shopify (TSX:SHOP) and Lightspeed Commerce (TSX:LSPD) both sell tools that help merchants run better businesses. Both were once market darlings. Both also taught investors a hard lesson when growth stocks fell back to earth.

Now the question looks more interesting. Shopify stock looks expensive again, but it keeps delivering. Lightspeed looks far cheaper, but it still needs to prove its turnaround can stick. So which stock looks like the better buy today?

SHOP

Shopify stock enters this matchup with the stronger hand. The company gives merchants a platform to sell online, in stores, across social media, through apps, and increasingly through artificial intelligence (AI) tools. It’s no longer just a website builder. Shopify stock now acts more like commerce infrastructure for businesses of all sizes.

The latest quarter showed that scale. In the first quarter of 2026, Shopify stock’s revenue climbed 34% to US$3.2 billion. Gross merchandise volume topped US$100 billion in a single quarter, up 35% from last year. Free cash flow hit US$476 million, with a 15% margin. This shows Shopify stock now produces serious cash while still growing quickly.

The catch comes down to price. Shopify stock trades with a massive market value near $188 billion on the TSX and a triple-digit price-to-earnings ratio of 103. That leaves little room for disappointment. If growth slows, if AI changes how consumers discover products, or if merchants pull back in a weaker economy, the stock could fall hard.

LSPD

Lightspeed offers the opposite setup. It looks much smaller, cheaper, and more beaten down. The company provides point-of-sale, payments, and software tools for retailers, restaurants, golf operators, and hospitality businesses. Its biggest opportunity sits in serving more complex merchants that need more than a basic checkout system.

Lightspeed’s latest results showed real progress. In the fourth quarter of fiscal 2026, revenue rose 15% to US$290.8 million. For the full year, revenue climbed 14% to US$1.2 billion. Its focused growth engines, mainly North American retail and European hospitality, grew revenue 24% in the quarter. The company also generated positive adjusted free cash flow of US$18.2 million for the year.

Lightspeed spent years trying to convince investors it could grow without burning cash forever. Management now talks about a three-year transformation plan, with a goal of about US$100 million in adjusted free cash flow by fiscal 2028. If it reaches that target, the stock could look meaningfully undervalued from here.

But Lightspeed still carries more “if” than Shopify stock. It posted a full-year net loss of US$144.4 million. The business also faces intense competition from Shopify and Toast, and other payment and retail software platforms. Its strategy depends on better execution, stronger sales, and deeper payments adoption. Investors need patience, because the turnaround could still disappoint.

Foolish takeaway

That creates the real split. Shopify stock asks investors to pay up for quality. Lightspeed asks investors to believe in a recovery. One offers durability. The other offers more upside if everything goes right.

So, which stock wins?

For most long-term investors, Shopify stock looks like the better buy, even at the higher valuation. That may sound strange, since Lightspeed offers more rebound potential. But Shopify stock combines stronger growth, stronger profitability, a larger ecosystem, and clearer competitive advantages. It has already proven it can scale, generate cash, and keep merchants inside its platform.

Lightspeed could deliver bigger percentage gains if the turnaround works, and certainly the company is meeting and indeed surpassing its expectations. It suits investors who can handle more risk and volatility. Shopify stock offers a more stable story, but at a price.