Investing in high-quality companies that offer high growth can help generate a significant amount of wealth over time. While TSX has several high-growth companies, I will focus on three stocks that are traded cheaply. Let’s dig deeper into these Canadian companies.
Speed of light
Shares of Lightspeed Commerce (TSX: LSPD)(NYSE: LSPD) is first on my list. This trading activating company has witnessed massive sales and its stock is shop cheap. It is worth noting that a brief report from Spruce Point Capital Management and expected slowdown in its organic growth rate eroded a significant portion of its value.
While harsh comparisons and normalization of demand trends in the midst of economic reopening may lead to a moderation in Lightspeed’s organic growth rate, I’m optimistic about its long-term outlook and its ability to expand rapidly.
Increasing use of its digital products, large addressable market, increased payment penetration and expansion to high-growth verticals and geographic areas suggest that Lightspeed Commerce is likely to deliver strong financial results in the coming years, driving up the share price. In addition, acquisitions and higher average revenue per. uses well for growth.
In addition, the fall in the Lightspeed stock has driven the valuation lower. The LSPD stock is trading at a forward EV / sales multiple of eight, which is significantly lower than its historical average. Overall, its low valuation and high growth business make it an attractive investment at current levels.
WELL Health Technologies (TSX: GOOD) is another high-growth company that is worth investing in in the long run. Its stock experienced a sharp setback in 2021 due to fears that economic reopening could lead to a slowdown in the growth rate. However, it continues to grow its revenue rapidly and expand rapidly based on acquisitions. Moreover, the significant fall in the price represents an excellent opportunity to accumulate its shares at current levels.
During the last reported quarter, WELL Health’s revenue increased by 711% year over year due to strategic acquisitions. In addition, its omnichannel patient visits increased by 139% year over year. It also continued to deliver positively adjusted EBITDA.
Looking ahead, I expect the WELL Health stock to benefit from the growing use of technology in the healthcare sector. Furthermore, its extensive network of outpatient medical clinics and omnichannel patient service offerings positions it well to take advantage of the ongoing shift in the healthcare sector towards digital.
WELL Health expects to deliver strong organic and inorganic growth in the coming quarters. Meanwhile, its EV / sales multiple is at one low in several years.
Shares in the financial technology company Nuvei (TSX: NVEI)(NASDAQ: NVEI) has also witnessed strong sales in recent times. Like Lightspeed, a brief report from Spruce Point Capital Management led investors to dump their shares. Nevertheless, management repeated its guidance, describing the short report as misleading.
I am optimistic about the digital payments segment and expect Nuvei to deliver strong financial results in the coming quarters. Furthermore, I see the fall in the share price as a solid buying opportunity.
Nuvei’s ability to acquire customers quickly, higher revenues from existing customers and expansion to the high-growth verticals bode well for future growth. In addition, its focus on innovation and operational leverage is likely to support its finances and, in turn, its share price.
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