2 TSX Stocks to Buy Today Instead of Dogecoin

Here’s why investing in growth stocks such as Shopify and Lightspeed is a better bet than investing in Dogecoin.

| More on:

The price of Dogecoin soared close to 25,000% in the space of 12 months, making it the fourth-largest cryptocurrency in early May 2021. However, the meme-based cryptocurrency has since lost significant value and is down 50% from all-time highs. The price of Dogecoin climbed higher in the last year soon after Wall Street maverick CEO Elon Musk tweeted about his investment in the digital asset.

But Dogecoin remains a high-risk bet due to its poor economics and unlimited coin supply. While most cryptocurrencies are limited in circulation, there are close to 130 billion Dogecoins outstanding. Further, just 13 wallets control 50% and 99 wallets control 67% of total Dogecoins in circulation, rendering it vulnerable to manipulation and volatility.

If you’re an investor with a high-risk appetite, it makes better sense to purchase growth stocks over the long term. Here we take a look at two TSX stocks you can buy today instead of Dogecoin.

Shopify is a resounding success story

The first stock on the list is Shopify (TSX:SHOP)(NYSE:SHOP), Canada’s largest company in terms of market cap. Shopify stock has already delivered staggering returns since its Initial Public Offering (IPO) six years ago. Investors who purchased SHOP stock after it went public would have seen it generate close to 4,700% in cumulative returns. However, the tech stock has now experienced a pullback and is down 20% from all-time highs.

The COVID-19 pandemic served as a tailwind for Shopify and its peers, accelerating the shift to online shopping. Shopify sales were up over 80% in 2020 and more than doubled in Q1 of 2021. Comparatively, its adjusted earnings increased to US$2.01 per share in Q1 compared to just US$0.19 per share in the prior-year period.

Shopify stock continues to trade at a premium with a forward price-to-sales multiple of 35 and a price-to-earnings multiple of 283. However, growth stocks command a steep multiple, making Shopify a stock to buy at every major dip. Analysts tracking SHOP stock expect the company to increase sales by 52% year over year in 2021, while earnings are forecast by 30% annually in the next five years.

Lightspeed POS is better than Dogecoin

The second TSX stock on my list is Lightspeed POS (TSX:LSPD)(NYSE:LSPD), a SaaS-based fintech company. LSPD disclosed its fiscal fourth-quarter results last week and reported sales of US$82.4 million, a rise of 127% year over year. The company also reported a loss per share of US$0.09, which was better than Bay Street loss estimates of US$0.10 per share.

Lightspeed also surprised investors after its recurring subscription and transaction-based sales jumped 137% in Q4, while average revenue per user was up 48%. The company’s management forecast sales between US$90 million and US$94 million in Q1 of fiscal 2022, indicating a growth of 154% at the midpoint compared to the year-ago period.

Bay Street expects LSPD to double its sales in fiscal 2022 to US$443 million and increase it by 33% to US$890 million in 2023. Comparatively, its loss per share is expected to narrow from US$1.16 in 2021 to US$0.37 in 2023.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Tom Gardner owns shares of Shopify. The Motley Fool owns shares of and recommends Shopify. The Motley Fool owns shares of Lightspeed POS Inc and recommends the following options: short January 2023 $1160 calls on Shopify and long January 2023 $1140 calls on Shopify. Fool contributor Aditya Raghunath has no position in any of the stocks mentioned.

More on Tech Stocks

Happy golf player walks the course
Tech Stocks

1 Tech Stock That Has Created Millionaires and Will Continue to Make More 

If you have been procrastinating about investing in this tech stock, you are losing the opportunity to make millions.

Read more »

Doctor talking to a patient in the corridor of a hospital.
Dividend Stocks

CRA Money: The Best Benefit to Claim in 2024

This benefit is one of the most broad ones you can claim from the CRA, yet many of us are…

Read more »

A worker gives a business presentation.
Tech Stocks

Will Shopify Stock Continue its Surge Into 2025?

Down 26% from all-time highs, Shopify is a beaten-down tech stock that continues to grow at an enviable pace in…

Read more »

artificial intelligence AI data deep processing
Tech Stocks

AI Stocks to Buy Now: A Canadian Investor’s Guide

E-commerce companies like Shopify Inc (TSX:SHOP) use generative AI to help vendors create product descriptions.

Read more »

Person uses a tablet in a blurred warehouse as background
Tech Stocks

The Best AI Stocks on the TSX

Canadian companies like Kinaxis Inc (TSX:KXS) are leading the charge in AI development.

Read more »

Representation of deep learning neural networks and connectivity
Tech Stocks

Is Dell a Better AI Stock Than Nvidia?

Between Dell and Nvidia, which is a better buy right now?

Read more »

TFSA (Tax free savings account) acronym on wooden cubes on the background of stacks of coins
Tech Stocks

2 Canadian Growth Stocks I’d Stash in a TFSA for the Long Haul

Well Health Technologies is one of two growth stocks well-suited for your TFSA, as strong returns are likely.

Read more »

A microchip in a circuit board powers artificial intelligence.
Tech Stocks

The Future of AI: Best Canadian Stocks to Buy Now

AI stocks like Kinaxis Inc (TSX:KXS) are doing big things.

Read more »