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Highlights
- The S&P/ TSX Capped Information Technology Index shot up by 1.203 per cent on Thursday, October 21
- A Canadian tech stock mentioned here surged by roughly 344 per cent in the past year.
- Another tech company listed below posted a return on equity of 39.60 per cent.
The Canadian technology sector went through a massive market selloff earlier this month that worried many investors. However, some market experts believe that tech stocks, specifically in cloud computing, e-commerce, and semiconductors, may possess the capability to outperform the sector in the long run.
The S&P/ TSX Capped Information Technology Index scaled up by 1.203 per cent on Thursday, October 21.
Also read: Is Cameco Corp (TSX:CCO) a uranium stock to buy?
This increase was likely due to Converge Technology Solution Corp, which gained nearly seven per cent. Likewise, Constellation Software Inc also boosted the sector performance by climbing more than one per cent.
On that note, let us explore some technology stocks listed on the TSX that could perform well in future.
1. Converge Technology Solutions Corp (TSX:CTS)
A software-enables information technology and cloud solution firm, Converge Technology Solutions Corp witnessed its stock trading at a day high of C$ 11.85 per share on October 21.
Also read: 5 Canadian bank stocks to buy before their dividends surge
However, it closed the session at C$ 11.8 per share, nearly 10 per cent down from the 52-week high of C$ 13.09 (September 7, 2021).
CTS stock experienced a year-over-year (YoY) surge of roughly 344 per cent. It climbed more than 137 per cent year-to-date (YTD). It also surged by almost 123 per cent in the previous six months.
With a market cap of C$ 2.48 billion, Converge Technology Solutions posted a price-to-book (P/B) ratio of 7.066 and a return on equity (ROE) of 3.61 per cent on Friday, October 22.
2. Constellation Software Inc (TSX:CSU)
Toronto-headquartered software provider Constellation Software Inc noted a closing price of C$ 2,242.74 apiece, weighing up by 1.361 per cent at the market close, on October 21.
During this trading session, it hit a day high of C$ 2,247.80 and surpassed the last 52-week high of C$ 2,245 it reached on Tuesday, October 19.
Stocks of the enterprise software developer soared by nearly 50 per cent in the last one year. It also jumped up by roughly 17 per cent in the past three months.
From the valuation front, it held a P/B ratio of 42.931 and an ROE of 39.60 on October 22.
3. Shopify Inc (TSX:SHOP)
Canadian e-commerce giant Shopify Inc saw its stock wrap up trade at C$ 1850.58 apiece, up by nearly one per cent, on October 21.
However, at this closing price, it had slumped by almost 11 per cent from the 52-week high of C$ 2,075.88 scored on July 26.
SHOP stock marked a YoY rise of almost 38 per cent. It climbed up by more than 35 per cent in the past six months and plunged by roughly eight per cent in the previous six months.
The stock appears to be on the course of improvement as it gained 0.39 per cent in the last 30 days and over six per cent in the past one week.
On October 22, Shopify Inc noted an ROE of 33.36 per cent and a return on asset (ROA) of 28.76 per cent.
Also read: Top 5 Canadian industrial stocks to buy in Q4 2021
Bottom line
The above-mentioned tech stocks are considered among the top tech players in the Canadian market and, therefore, could be worth exploring if one is looking to invest their money for the long term.
However, before diving into any sort of investment decision, it is extremely crucial that investors gain a basic understanding of the stock market dynamics and the fundamental strength of the stocks. This practice is not done just in the hopes of good returns, but also keeping in mind their risk-return preference.
