- Technology advancements continue to revolutionize industries worldwide and the Canadian stock market is feeling the benefit of a homegrown wave
- Tech stocks are companies whose products or services use technology at the core of their business
- The TSX has witnessed a surge in tech stocks, offering investors lucrative opportunities to gain exposure to this rapidly growing sector
- Investing in tech stocks can be a promising venture for Canadian investors looking to capitalize on the sector’s rapid growth
Technology advancements continue to revolutionize industries worldwide and the Canadian stock market is feeling the benefit of a homegrown wave.
The Toronto Stock Exchange (TSX) has witnessed a surge in tech stocks, offering investors lucrative opportunities to gain exposure to this rapidly growing sector. Tech stocks are companies whose products or services use technology at the core of their business. Here is a list of just a few of the top TSX technology stocks that have been capturing attention and generating substantial returns for investors.
1. Shopify Inc. (TSX:SHOP):
Shopify (market cap: C$79.85 billion) is a Canadian e-commerce giant that has witnessed extraordinary growth since its inception.
The company offers a cloud-based, multi-channel commerce platform that enables businesses of all sizes to establish and manage their online stores. With an impressive customer base and continually expanding product offerings, Shopify has carved out a dominant position in the e-commerce market. As the pandemic accelerated the shift towards online shopping, Shopify’s stock price soared, making it one of the hottest tech stocks in the TSX.
The company released financial results for its Q2 2023 after markets closed Wednesday.
SHOP stock is up 90.6 per cent year to date and up 84.3 per cent since this time last year.
Shopify Inc. closed trading Thursday at C$78.89 per share.
2. Constellation Software Inc. (TSX:CSU)
Constellation Software (market cap: C$56.51 billion) is a diversified software company that acquires, manages, and builds industry-specific software businesses.
With a disciplined acquisition strategy, the company has created a portfolio of highly specialized software solutions serving a wide range of sectors, including public safety, education, healthcare, and more. Constellation’s growth strategy, coupled with its solid financial performance and track record, makes it an attractive investment option in the tech sector.
The Toronto-based software company has been riding a wave of good news recently, capped off by a deal to buy Black Knight Inc.’s (NYSE: BKI) Optimal Blue business for US$700 million, paving the way to become the top U.S. mortgage software provider.
CSU stock is up 33 per cent year to date and 33.5 per cent since August 2022.
Constellation Software Inc. closed trading at C$2,664.50 per share.
3. Lightspeed POS Inc. (TSX:LSPD)
Lightspeed POS (market cap: C$3.30 billion) offers an all-in-one, cloud-based commerce platform, empowering small and medium-sized businesses to run their operations seamlessly.
The Montréal-based company’s software suite combines point-of-sale, e-commerce, and inventory management tools, providing a comprehensive solution for retailers and restaurateurs. Despite the pandemic’s impact on the retail and hospitality industries, Lightspeed has been able to demonstrate resilience and adaptability, attracting investors who recognize its potential for long-term growth.
Lightspeed recently launched several advanced features designed to streamline merchant operations: time clock, shipment history and automated ordering.
Since the beginning of the year, LSPD stock has risen 18.8 per cent, up 34.3 per cent over the past three months.
Lightspeed POS Inc. closed trading at C$23.29 per share.
4. Descartes Systems Group Inc. (TSX:DSG)
Descartes Systems Group (market cap: C$8.58 billion) specializes in providing cloud-based logistics and supply chain management solutions. The company’s software helps organizations optimize their logistics operations, improve efficiency, and streamline communication throughout the supply chain. As global trade continues to evolve and become more complex, Descartes is well-positioned to benefit from increased demand for its innovative solutions.
DSG stock traditionally sees some up and down movement. Shares may be seeing a 3.7 per cent decline compared with three months ago, but over the past year it has gained 16.7 per cent.
Descartes Systems Group Inc. closed trading at C$99.93 per share.
5. Open Text Corp. (TSX:OTEX)
Open Text (market cap: C$14.76 billion) has a significant share of the Enterprise Information Management (EIM) software market.
Operating out of Waterloo, Ontario, the company’s offerings enable organizations to securely capture, manage, and leverage their unstructured data to drive productivity and make informed business decisions. Open Text’s extensive product portfolio and strategic acquisitions have allowed it to establish a strong market presence and attract major corporate clients worldwide.
The information company just released Cloud Editions 23.3, which has integrated artificial intelligence (AI) and analytics capabilities across its portfolio.
“It will reshape the future of our world in unimaginable ways. If the internet changed everything, with AI, everything must change. OpenText has a deep history of helping our customers connect and manage their operational and experience data, and now there is a whole new frontier of learning data from the exponential growth of AI that will lead to new possibilities.”
Compared with January, OTEX stock is up 40 per cent and 8.2 per cent higher since August 2022.
Open Text Corp. opened trading at C$54.08 per share.
Datametrex AI (TSXV:DM) has exposure to the AI, machine learning, telehealth, and electric vehicle markets. The company provides tools that support companies in fulfilling their operational goals, including health and safety, with predictive and preventive technologies.
RDARS (Real-Time Drone Alarm Response System) (CSE:RDRS) is a drone and robotics company that’s applying autonomous technologies to disrupt the growing US$300 billion residential and commercial security markets.
ARway (CSE:ARWY) is an AI and augmented reality (AR) navigation platform for the real-world metaverse. The company is transitioning to a SaaS business model and expects this automation will result in increased revenue, expanded distribution channels, increased usage, and traction.
Investing in tech stocks on the TSX can be a promising venture for Canadian investors looking to capitalize on the sector’s rapid growth.
These companies are just a few that have demonstrated an ability to innovate and adapt to changing market dynamics.
Due diligence is a must. It is essential for investors to conduct thorough research, consider their risk tolerance, and consult with a financial advisor before making any investment decisions.
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