Stock Up Sale
The price of bitcoin has frankly tanked in recent weeks with the world’s leading cryptocurrency having lost nearly half its value in a little more than a month.
Recall for a moment Warren Buffett’s quote on crypto markets from last year when he mused, “I can say with almost certainty that they will come to a bad ending.”
Regardless of whether you agree with the Oracle or not, until we have more clarity on whether or not crypto currencies are a truly legitimate asset class, these three tech stocks from the TSX Index should prove far more reliable stores of value.
BlackBerry Ltd (TSX:BB)(NYSE:BB) is in the midst of its turnaround from being predominantly a cell phone handset maker to now being predominantly a software and security technology company.
The writing was on the wall for some time as consumers moved away from BlackBerry handsets in droves over the past decade in favour of sleeker iPhone and Android designs, but the nail in the coffin as far as the Waterloo-based IT’s fate as a smartphone maker arguably came when the U.S. government terminated its procurement contract with BlackBerrry.
Yet BB has since retargeted its resources at developing leading-edge security for the Internet of Things, and thus far the results have been overwhelmingly positive.
Declines in its legacy hardware business have masked solid growth in its software and services business, which has made the company’s reported results on the surface appear worse than they are in reality.
Shopify Inc (TSX:SHOP)(NYSE:SHOP) has catapulted itself as a leader in e-commerce software over the past decade or so.
Designed by entrepreneurial partners who saw the need for a sleeker online platform for small businesses to conduct business online, SHOP stock has taken off, up more than 750% since the beginning of 2016.
SHOP may never get quite to the heights of an Amazon.com, Inc. which currently has a market capitalization of US$775 billion, but with a market cap of just north of US$16 billion, there’s still plenty of room for this stock to run before it gets even close to that number.
Maxar Technologies Ltd (TSX:MAXR)(NYSE:MAXR) had a rough month in October, losing more than 55% of its value, with the stock now down more than 70% in 2018.
Like BlackBerry, Maxar is also undergoing its own restructuring right now; however, BB is certainly further ahead with its turnaround than MAXR at this point.
Take, for example, the impairment charge that Maxar had to take in the most recent quarter.
While the US$346 million impairment loss is a non-cash charge, these types of announcements have the potential to spook investors, particularly if they were already nervous about the fact that the shares had already fallen to levels they’d believed were nearly impossible.
Yet following the sell-off in MAXR stock this year, the shares are now yielding more than 6%, which might be enough to lure dividend investors, who may traditionally stay away from tech companies, into the stock.
Fool on.
