Top Tech Wild Cards Canadian Investors Should Watch

While not well-known, these three TSX tech stocks might be excellent holdings for risk-tolerant investors who want to capitalize on the ongoing market rally.

| More on:

Investing in high-risk growth stocks is not easy for every Canadian investor to stomach, especially after the last few years of full market volatility. However, it was only a matter of time before the stock market would go through a turnaround, and that is exactly what might be on the cards right now.

After showing largely sideways movement between 2022 and the end of 2023, the S&P/TSX Composite Index is showing signs of new life. As of this writing, the Canadian benchmark index is up by 14.35% year to date, reaching new all-time highs almost daily for the last few weeks. The much-anticipated cut in key interest rates has spurred the stock market into an upward rally.

Today, I will discuss three risky but high growth potential investments you should watch closely against this backdrop.

Real Matters

Real Matters (TSX:REAL) is a $639.02 million market capitalization network management services provider, primarily working for the mortgage lending and insurance industries. Operating in Canada and the U.S., it derives most of its revenue from its U.S. Appraisal segment, providing mortgage appraisals for purchase, refinance, and home equity transactions.

With institutional investors making up around 45.1% of its ownership stake and just below 50% of its being held by the general public, it can be reasonable to believe that experts see real potential in the stock.

As of this writing, the stock trades for $8.69 per share. While down by over 73% from its August 2020 all-time high, Real Matters stock has picked up pace on the stock market recently. It is up by 38.38% year to date.

Sangoma Technologies

Sangoma Technologies (TSX:STC) is a $258.66 million market capitalization, Markham-based Canadian company that offers communications-as-a-service products to businesses. It provides hardware and software that enable communications for companies.

It develops, manufactures, distributes, and supports voice and data connectivity components, with most of its clients based in the U.S. and Canada, along with a few international markets.

Between August 20 and September 18, its share prices shot up by 21.15%. As of this writing, it trades for $7.76 per share, up by a massive 158% from its 52-week low. The last three years have seen Sangoma Technologies increase its revenue at a 22% compounded annual growth rate, yet its share prices only recently started rallying after the interest rate cut.

The recent uptick in its share prices might indicate that the market is slowly starting to realize its long-term value. However, it might be too early to say that this signals sustained long-term gains.

Evertz Technologies

Evertz Technologies (TSX:ET) is a $913.37 million market capitalization company headquartered in Burlington that develops software and hardware products for the broadcast and film industry.

The equipment it makes comes into use in production, post-production, and the transmission of television content. Broadcasters, content creators, and service providers seeking multi-channel digital and high-definition television content purchase its products.

Generating most of its revenue from the U.S., the company’s earnings per share is expected to grow by 2.3% over the next year. However, its high 91% payout ratio for its dividends yielding 6.50% does make it seem like a risky investment. As of this writing, ET stock trades for $12 per share, up by 5.35% from its 52-week low.

Foolish takeaway

Interest rate cuts act like an adrenaline shot for equity securities. For investors seeking riskier investments with higher growth potential, now might be the time to consider allocating some cash. If you have a well-balanced portfolio and want to take some risk, these three TSX tech stocks can be worth considering right now.

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 Adam Othman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Real Matters. The Motley Fool has a disclosure policy.

More on Tech Stocks

The virtual button with the letters AI in a circle hovering above a keyboard, about to be clicked by a cursor.
Tech Stocks

Is OpenText Stock a Buy, Sell, or Hold for 2025?

OpenText stock has fallen in the last few years, but that could mean this top tech stock remains an undervalued…

Read more »

AI microchip
Tech Stocks

Celestica Stock: Buy, Sell, or Hold?

Celestica's stock price has rallied 950% in the last five years. Will the AI boom send it even higher in…

Read more »

data analyze research
Tech Stocks

2 Ridiculously Cheap Growth Stocks to Buy Hand Over Fist in 2024

Well Health Technologies is a cheap growth stock to buy for its record-breaking results, massive revenue growth, and profitability.

Read more »

A worker uses a double monitor computer screen in an office.
Tech Stocks

4 Reasons to Buy Kinaxis Stock Like There’s No Tomorrow

Kinaxis stock has a strong past. But there is even more to look forward to from this top tech stock.

Read more »

The letters AI glowing on a circuit board processor.
Tech Stocks

The Future of AI: Best Canadian Stocks to Buy Now

Here are two of the best AI-focused stocks in Canada that you can consider adding to your portfolio before it’s…

Read more »

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Tech Stocks

2 TFSA Stocks to Buy Right Now With $7,000

Are you looking for growth stocks that can help you maximize the tax-free withdrawals of the TFSA? This article is…

Read more »

cloud computing
Tech Stocks

3 No-Brainer Tech Stocks to Buy Right Now for Less Than $1,000

Not all tech stocks are the risky investments that many think they are. Which is why we're focusing on the…

Read more »

An analyst uses a computer and dashboard for data business analysis and Data Management System with KPI and metrics connected to the database for technology finance, operations, sales, marketing, and artificial intelligence.
Tech Stocks

Where Will Open Text Stock Be in 5 Years?

OpenText stock is one of the few tech stocks that's been around for decades. But does it have what it…

Read more »