Where to Invest $10,000 in a Bullish Market

Here’s why investors can consider holding growth stocks such as Shopify and Payfare right now and derive outsized gains.

| More on:

A bull market is a great time to invest in the stock market. Due to improved market sentiment and the possibility of sustained economic growth, the stock market generally delivers inflation-beating returns in a bull run.

Long-term investors can consider gaining exposure to quality growth stocks in a bullish market. Typically, growth stocks generate outsized gains and beat the broader markets by a wide margin during bull runs. Here are three quality growth stocks you can buy with $10,000 right now.

Shopify stock

Down 52% from all-time highs, Shopify (TSX:SHOP) stock trades at a market cap of $131 billion. Operating in the e-commerce segment, Shopify allows merchants to quickly set up an online presence. Founded in 2006, Shopify continues to widen its portfolio of products and solutions.

For instance, it allows developers to add multiple payment options and create inventory tracking tools, design templates, and data-powered dashboards, all of which result in higher engagement rates. More than two million merchants use Shopify and the Canadian tech giant controls 30% of the e-commerce platform market in the U.S.

While Shopify’s top-line growth has decelerated in recent years, it is forecast to grow sales by 21% to $11.6 billion in 2024 and by 20% to $13.8 billion in 2025. Comparatively, adjusted earnings per share are forecast to grow by 91% annually in the next five years.

Given these estimates, Shopify should end 2028 with adjusted earnings of $25 per share. If the stock is priced at 30 times forward earnings, it should trade around $750, indicating an upside potential of more than 600% from current levels.

Payfare stock

A small-cap stock with massive upside potential, Payfare (TSX:PAY) is trading 52% from record highs, allowing you to buy the dip. Payfare is a fintech company that powers instant payout and digital banking solutions for the gig workforce.

It ended 2023 with 1.4 million active users, an increase of 33% year over year, and is forecast to increase sales from $130 million in 2022 to $235 million in 2024.

Unlike several other growth stocks, Payfare reports consistent profits and is on track to end 2024 with adjusted earnings of $0.58 per share, compared to a loss of $0.06 per share in 2022.

Priced at 11 times forward earnings, Payfare stock is quite cheap and trades at a discount of 60% to consensus price target estimates.

Enghouse Systems stock

The final TSX stock on my list is Enghouse Systems (TSX:ENGH), which also offers shareholders a tasty dividend yield of 3.4%. It reported revenue of $120.5 million in the fiscal first quarter (Q1) of 2024 (ended in January), up from $106.4 million in the year-ago period. Enghouse’s recurring revenue rose 27.2% to $84.6 million, accounting for 70% of total sales.

A widening base of recurring revenue should help Enghouse generate stable cash flows across market cycles and maintain its dividend payout. Enghouse Systems emphasized recurring revenue accounts for an increasing proportion of sales as the software market transitions towards software-as-a-service-based offerings.

A debt-free balance sheet makes Enghouse immune to interest rate hikes. Further, the company ended Q1 with $247.4 million in cash providing it with the flexibility to fund its growth plans.

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.

Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Enghouse Systems, Payfare, and Shopify. The Motley Fool has a disclosure policy.

More on Tech Stocks

Data center servers IT workers
Tech Stocks

Better Buy: Shopify Stock or Constellation Software?

Let's dive into whether Shopify (TSX:SHOP) or Constellation Software (TSX:CSU) are the better options for growth investors in this current…

Read more »

nvidia headquarters with nvidia sign in front
Tech Stocks

Nvidia Just Delivered a Beat-and-Raise Quarter. There’s 1 Red Flag Investors Shouldn’t Ignore.

The chipmaker continued to benefit from robust demand for artificial intelligence (AI). But can it last?

Read more »

GettyImages-1473086836
Tech Stocks

Why Super Micro Computer Stock Is Soaring Today

The volatile stock is getting a boost from Nvidia.

Read more »

Snowflake logo in snowflake office on wall_snowflake-1
Tech Stocks

Here’s Why Snowflake Stock Skyrocketed Today

Shares of the data company are up 32% for the day.

Read more »

man touching magnifying glass button on floating search bar internet google search engine
Tech Stocks

Why Alphabet Stock Was Sliding Today

The parent company of Google is facing heat from U.S. regulators.

Read more »

chart reflected in eyeglass lenses
Tech Stocks

Top Canadian AI Stocks to Watch in 2025

Celestica (TSX:CLS) stock and another Canadian AI stock are worth watching closely this holiday season.

Read more »

Nvidia Voyager Headquarters
Tech Stocks

Why Nvidia Stock Rallied (Again) on Tuesday

The chipmaker is expected to report earnings this evening.

Read more »

hand stacking money coins
Tech Stocks

3 Growth Stocks That Are Screaming Buys in November

The market might be soaring, but there are still lots of deals to be had. Here are three discounted stocks…

Read more »