Business & Investment

TFSA Top Pick: The $ 6,000 invested in the first quarter is today worth over $ 50,000

Few TSX stocks have rebounded so impressively. Lightspeed POS (TSX: LSPD)(NYSE: LSPD)..

The stock now has a $ 6,000 TFSA investment Pandemic lows Over $ 50,000 today in March. This absolutely impressive return could allow investors with gut strength to buy overwhelmed technology stocks when things look miserable.

Lightspeed turned out to be one of the best stocks in Canada during this period. This is the reason.

The core business model for the success of this stock

Lightspeed’s business model is highly sought after by growing investors. Lightspeed makes money through subscriptions from customers who are mostly trapped in retail space. Concerns about how the coronavirus pandemic would affect retailers were short-lived, given how strong Lightspeed’s revenue growth was through the pandemic.

This Software-as-a-Business (SAAS) model resembles a companion to Canada’s tech giants. Shopify.. If your client is based on certain point-of-sale software, or a full-service online store platform for Shopify, you’ll find that the churn rate is very low.

Given the relatively low cost of the Lightspeed platform and the essential nature of this software, retailers pay this invoice first. The bankruptcy rate has not significantly affected the company’s growth trajectory. On the contrary, companies are struggling to find the edge to improve profitability by the means they need. The Lightspeed platform helps retailers do so.

Evaluation remains a major concern

This rise in stock prices would not have been possible without its own concerns about today’s light speed valuations. The company is currently trading about 69 times more at the time of writing. Shopify’s sales are 78 times higher, so some investors say the stock is cheap in this crazy era.

All in all, the growth of these software is trading like such stocks near the peak of the dot-com bubble. Investors need to pay attention to such investments and ensure that owning a well-diversified portfolio that includes a defensive core is part of their long-term investment strategy.

That said, given the value that TFSA offers in limiting capital gains taxes, investing in TFSA should be rooted in growth stocks. Lightspeed turned out to be a real winner. In this stock market, running the winner has proven to be the way to go. Therefore, investors should consider acquiring Lightspeed or Shopify shares if they fall. Given that US technology stocks are showing outperformance, it’s also a great strategy to focus on US technology names as well.

Speaking of amazing growth stocks …

This little TSX stock could be the next Shopify

One of the lesser-known Canadian IPOs has doubled in value in a few months, and renowned Canadian stock picker Iain Butler sees potential billionaire makers waiting. I’m …
He thinks this fast-growing company looks a lot like Shopify, so Iain officially recommended shares three years ago before it surged 1,211%!
Iain and his team have published a detailed report on this small TSX stock. Find out how to access NEXT Shopify today!

Click here for instructions.

Stupid contributor Chris Macdonald There are no positions in any of the listed stocks. Tom Gardner I own a stake in Shopify. Motley Fool owns and recommends shares in Shopify and Shopify. Motley Fool owns a stake in Lightspeed POS Inc.

TFSA Top Pick: The $ 6,000 invested in the first quarter is today worth over $ 50,000 TFSA Top Pick: The $ 6,000 invested in the first quarter is today worth over $ 50,000

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