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Want to grow right now? Aren’t we all. However, finding a top-notch growth stock with the ability to hit its valuation multiples is a more difficult question.
In recent years, the Toronto Stock Exchange saw the addition of some new and exciting growth stocks. The majority of these big power growth stocks have outperformed the broader market. In fact, in many ways this rally has been a long time coming.
Let’s take a look at three growth stocks that are likely to continue to outperform over the long term.
Shopify: A Leading Canadian Growth Stock
Shopify (TSX: SHOP) (NYSE: SHOP) extends the software tools and digital infrastructure through which businesses can establish a presence in e-commerce. These businesses can be of any size. Businesses can manage both physical stores and online operations through this platform.
Last year, Shopify received the second largest share in the ecommerce market after Amazon and recorded 8.6% of e-commerce retail sales in the United States.
It’s impressive.
Indeed, Shopify’s reach makes this action an action that now amazes international investors. That’s because Shopify caters to a large customer base that exceeds 1.7 million businesses worldwide. The company has also built a community of 46,400 partners. He created an ecosystem of 7,000 applications, helping to expand the core capabilities of the business.
The ability of this company’s ecosystem to handle a range of use cases across industries allows more merchants to sign up for its services. This growing customer base, in turn, makes it very attractive to app developers and partners.
The rise of omnichannel retail is a huge growth engine for this e-commerce player. Shopify is also leveraging its partnerships with Facebook and TikTok to attract more entrepreneurs and traders.
In 2020, Shopify’s revenue soared 86% to a valuation of $ 2.9 billion. It rose another 57% year-over-year to reach $ 1 billion in the second quarter of this year. The visibility of the company’s revenue is also improving. As a result, investors view Shopify as a growth stock with the ability to really grow in its valuation right now.
At the end of the line
Shopify’s business model itself offers growth potential, unlike most Canadian tech stocks. This company’s unique exposure to the age-old e-commerce catalyst is unlike any other stock traded on the TSX.
Like many other high-profile stocks, Shopify’s valuation worries some investors. However, given this company’s ability to beat expectations each quarter, this is a growth stock that investors have learned to stick with for the long term.
