3 on this list, but we’ve reduced it due to a huge run
up in price. However, it’s still a great long term option for Canadians.
Royal Bank 5 year performance vs TSX
Top Canadian Tech Stocks That Should Outperform the TSX in 2021 and BeyondThe technology sector continues to enthrall investors of all ages. Someinvestors view companies in the tech space as a high-risk investment as thisindustry thrives on disruption which may make a market leader today irrelevanttomorrow. For example, companies such as Nokia and BlackBerry led the mobiledevice market before the advent of smartphones. However, the entry of Appleand Samsung in the smartphone market wiped out their market share and drovetheir stocks lower at a rapid pace.For others, tech stocks provide an opportunity to create massive wealth overtime. Shares of Apple, Amazon, Netflix, Microsoft, and Alphabet have returned975%, 1,750%, 1,420%, 841% and 786% respectively in the last decade. We cansee technology stocks offer investors significant returns but also carrycertain risks.
What are technology stocks?
Similar to any other industry, companies in the tech sector come in all sizes.You will find emerging start-ups as well as billion-dollar giants that arehousehold names in this space. A technology company is one that is involved inthe development and distribution of hardware and software products orservices.It is an exciting sector that is home to several emerging trends includingartificial intelligence, blockchain, cloud computing, SaaS (software-as-a-service), machine learning, online streaming, e-commerce, and many more.While tech stocks south of the border are popular all over the world, Canada-based companies are slowly carving a niche in the last few years.One way to invest in Canadian tech stocks is by purchasing ETFs such as theiShares S&P/TSX Capped Information Technology Index which gives youdiversified exposure to the largest companies in the country. The ETF has beenon an absolute tear and has returned close to 500% since May 2011.On the other hand, you can also look to buy and hold shares of individualcompanies that have the potential to grow your wealth at a market-beatingrate. An ideal tech stock is one that is part of a rapidly expandingaddressable market allowing it to grow top-line and profitability at a fastclip.Here, we take a look at a few Canadian tech stocks that should beat theoverall market not just in 2021 but over the long-term as well.
Founder/s: Barnaby Hussey-YeoFounded year: 2016Total funding: £44.7MBased out of London, Cleo is a fintech app designed for Gen-Z to assist interms of finance. Last year, the company raised $44 million (approx £33.2million) in Series B funding led by EQT Ventures with participation fromexisting investors Balderton Capital, LocalGlobe, and SBI. Cleo also plans toexpand in the US further, as it continues to make leadership hires in the BayArea. You can check out available positions over here.Image credits: Palo Alto Networks
Palo Alto Networks
Founder/s: Nir Zuk, Rajiv Batra, Yuming Mao, Dave StevensFounded year: 2005Total funding: £50.7MPalo Alto Networks, Inc. is an American multinational cybersecurity companywith headquarters in Santa Clara, California. Its core products are a platformthat includes advanced firewalls and cloud-based offerings that extend thosefirewalls to cover other aspects of security. They’re hiring for multiplepositions in London.Image credits: Trustpilot
Some tips for remote interviews
Talking about how job seekers can ace a remote interview, especially duringcurrent times, Gettrick notes, “Be really clear where your experience andpassion can make a difference. Founders are obsessed by their businesses, andthe people that join them to help realise their dreams are very important. Itreally is personal ! So know the business, research the founders and make sureyou really understand what it’s like to join a startup.”For interviewees, she shares a few tips from her experience, especially forremote interview processes.1. Check that the technology the company uses is working before you join themeeting – and especially your camera. 2. Try to relax and be yourself as much as you can, you are trying to createa connection and a lot of your body language isn’t visible. Smiling a lot, and ensuring eye contact are my two ‘go to’ tips when I ambeing interviewed – and I strongly recommend them both. 3. Show that you have researched the company and the person who isinterviewing you. It can help make a fast connection as you get to know eachother. 4. Follow up with a short email afterwards, thanking the interviewer. Itmakes you stand out, shows your commitment to the role and also keeps youfront of mind.Ceridian IPO is a tech record for the Toronto Stock ExchangeThe TMX Group today announced that the Toronto Stock Exchange and the TSXVenture Exchange were first in the world for new listings amongst all globalexchanges last year. This was the fourth consecutive year the TMX topped thelist, which is compiled by the World Federation of Exchanges (WFE).Human resources software company Ceridian HCM Holding Inc. (Ceridian StockQuote, Chart, News: TSX:CDAY, NYSE:CDAY) began trading on both the TSX andNYSE today with an initial public offering (IPO) that raised US$462 million,making it the largest tech company by market capitalization to ever IPO inCanada.Founded in 1992, Ceridian has been around for longer than most tech companies,with its current iteration having a lot to do with its acquisition in 2012 ofCanadian software company Dayforce Inc. The company realigned itself as acloud platform software-as-a-service (SaaS) provider of HR managementfunctions with a reach to over 50 countries worldwide. Based in Minneapolis,Ceridian is managed out of Toronto by CEO David Ossip, former Dayforce chief.“I am extremely proud of our Canadian heritage. With almost 2,000 employeesand the majority of our leadership team here, we are committed to advancingtechnology innovation in Canada,” said Ossip to mark the occasion in a newsrelease. “Ceridian’s listing on the Toronto Stock Exchange validates thiscommitment as we continue to disrupt the human capital management market andmake work life better for people in Canada and around the world.”Ceridian will sell 21 million shares at US$22 each, with an underwritingsyndicate led by Goldman Sachs, JPMorgan, Credit Suisse and Deutsche Bank andalso including CIBC Capital Markets and Canaccord Genuity.With a market cap of approximately US$3 billion, CDAY becomes the largest techcompany to IPO and one of the 30 largest TSX-listed companies by grossproceeds raised. Altogether, the TSX and TSX-Venture are said to host 421technology and innovation companies with a combined market capitalization ofover C$193 billion.“We are proud to welcome Ceridian, a company championing progressive changefor businesses across the world, to TSX,” said Loui Anastasopoulos, President,Capital Formation, for TMX Group. “Supporting the vibrant growth of technologycompanies around the world is a primary objective for TMX’s capital formationecosystem and we continue to seek out innovative solutions to address theneeds of our domestic and international clients.”16 Top Tech Stocks for MillennialsWe asked our Foolish analysts to name their top tech stocks for our Millennialaudience. Here are their choices:
Ryan Vanzo: BlackBerry Ltd
If you’re a millennial investor, it doesn’t get much better than BlackBerry(TSX:BB)(NYSE:BB). You may know this tech stock as a smartphone manufacturer,but last year, it didn’t produce a single phone. Today, it’s a pure-play oncybersecurity software.Cybersecurity has never been more important. Every year, the world addsmillions of newly-connected devices. All of these devices need to be protectedfrom hacking. Blackberry makes the software that makes this possible. Its QNXplatform, for example, is already installed in 150 million cars worldwide.Right now, BlackBerry stock trades at 3 times sales. Competitors likeCrowdstrike trade at a 500% premium! Once the market catches onto BlackBerry’snew business model, expect that discount to narrow quickly.Fool contributor Ryan Vanzo has no position in any stocks listed.
Jed Lloren: Shopify
Shopify (TSX:SHOP)(NYSE:SHOP) is my pick for the best TSX stock formillennials to add to their portfolio. Although the company has shown anincredible amount of growth over its time as a publicly-traded company,especially in the past year, we are still in the infancy of e-commerce.Because of this, Shopify still has a lot of potential growth ahead.One of the biggest beneficiaries of the COVID-19 pandemic, Shopify has seen alarge surge of consumers turn to online shopping during the lockdowns. Thecompany has also been in the spotlight recently to announce new partnershipswith Facebook and Walmart. Expect future developments from Shopify to beannounced as the company continues to find ways to innovate the e-commerceindustry.Fool contributor Jed Lloren owns shares of Facebook and Shopify.
Robin Brown: Descartes Systems Inc.
Although Descartes Systems (TSX:DSG)(NASDAQ:DSGX) is a pricey stock today, itis perfect for investors with a long investment horizon. It is a leadingprovider of logistics/supply-chain software, networks, and digital solutions.As global trade increasingly becomes complex, Descartes stands to benefit froma wave of customers seeking to digitize and optimize their logisticsplatforms.Descartes produces very predictable revenues (89% are reoccurring) andaccretes significant free cash flow. It has a $46 million net cash position,which it will likely deploy into accretive acquisitions this year. Betweenacquisitions and organic growth, management targets 10-15% adjusted EBITDAgrowth per year. Compound that over a lifetime and it makes for a pretty sweetCanadian tech stock to own.Fool contributor Robin Brown owns shares of DESCARTES SYS.
Sneha Nahata: Enghouse Systems
Enghouse Systems (TSX:ENGH) stock grew significantly this year as COVID-19 isproving to be a tailwind for the company. Enghouse’s software and solutionssupport remote work and customer interaction, the demand for which remainshigh. As the world deals with the pandemic, remote work is likely to be thenew normal, creating significant growth opportunities for the company in thelong run.While its underlying business remains strong, Enghouse boosts its growthfurther through acquisitions. The company has a strong track record ofacquiring businesses that expand its product suite and drive profitablegrowth. Its recent acquisitions of Vidyo and Dialogic are generating stellarrevenues and are contributing meaningfully to its profit margins.Sustained demand, expansion of its product suite, and acquisitions shouldcontinue to drive double-digit growth in its top and bottom line. Besides, itsdividends grew at a CAGR of 16% since 2015, making it a perfect stock forinvestors seeking both growth and income.Fool contributor Sneha Nahata has no position in any of the stocks mentioned.
Karen Thomas: Evertz Technologies Ltd.
Evertz Technologies (TSX:ET) is a little-known quality tech stock that has astrong history of shareholder value creation. Evertz designs, manufactures,and markets video and audio infrastructure solutions for the broadcastingindustry. It is a business that has both consistent and reliable results, aswell as good growth ahead.The broadcast equipment market is experiencing a secular shift that is beingfueled by the following factors: The transition from analog to digital,growing demand worldwide for HDTV, government mandate for digital, and thefact that broadcasters are in the process of building their infrastructure.And the company’s growth profile has recently been accelerated in thispandemic, with increases in video streaming driving additional demand.Evertz consistently generates high returns on equity, strong free cash flows,and a healthy balance sheet. These factors make it a solid investment formillennials looking for growth as well as safety and income. Evertz iscurrently yielding 3%, and in the past, the company has chosen to returnexcess cash to its shareholders in the form of special dividends.Fool contributor Karen Thomas does not own shares of Evertz Technologies Ltd.
In a hurry? Here’s the list:
1. VGT – Vanguard Information Technology ETF 2. XLK – Technology Select Sector SPDR Fund 3. QQQ – Invesco QQQ Trust 4. FDN – First Trust Dow Jones Internet Index Fund 5. ARKK – ARK Innovation ETF
Introduction – Why Tech Stocks?
The tech sector is comprised of companies related to software, electronics,internet, computers, and other technological products and services. ThinkApple, Microsoft, Adobe, Amazon, etc. Tech stocks are growth stocks,reinvesting profits into R&D and future projects to drive growth throughinnovation and invention. They usually pay low or no dividends.The tech sector has expanded over the years as more internet- and software-focused companies have emerged. It is now by far the largest sector in thestock market, comprising over 25% of the total market by weight. Every cornerof the modern economy touches technology in some way. Tech has been a majorcontributor to the growth of the total stock market in recent years, andspecifically Big Tech (Amazon, Apple, Google, Microsoft, etc.). Because ofthis concentration of weight, constituents of the tech sector were reshuffledin late 2018 with a redefining of the GICS, e.g. Amazon went to ConsumerDiscretionary, Facebook went to Communication, etc.Tech stocks have vastly outpaced the market over the last decade:Source: PortfolioVisualizer.comMany speculate that tech will continue its meteoric rise. Only time will tell.Let’s look at the best tech ETFs.