Shopify Inc. (SHOP.TO)

[Is it too late to add?] Technology is a key driver of the market right now. You want positions there. Don’t focus only on one sector. He has recommended this a couple of times on this show. They only have a 5% market share at present. They are moving into credit and delivery. This is a company that can continue to grow. These are three and four percent positions in portfolios.

If you buy this tomorrow and hold it for 5-10 years, you will do just fine. If you buy it tomorrow and hold it for 1 year, he has no idea what could happen. A very high-priced stock. Growth rates of these companies are impressive. The future is strong, but the price you pay is high. Buy a little bit tomorrow, and buy more 6 months from now. That is the way you have to chew your way into these stocks.

Had a tremendous run up to about $130, recently consolidated, and has now broken through that period of consolidation. Feels it is a little extended. Added to his holdings at about $136 when it broke through. The last period of consolidation was relatively short and relatively shallow, which generally is very bullish technically. Their runway for growth is tremendous as there is something like 10 billion small business owners in North America, and they have penetrated about 500,000. It would be an excellent complement to Amazon’s (AMZ-N) business. Wait for a bit of a pullback into the mid-$140 to low-$140.

At this price he would not be buying more. It is 17 times this year’s revenues and 12 times next year’s. If you bought in at lower levels don’t buy more. Make sure to protect your gains.

One of the few Canadian growth stocks where multiples are scary. This company has moved into the small business area and is offering backup services that makes them just as competitive as the big guys. A tremendous opportunity for small businesses to survive in this digital age. They have a huge market out there that is yet to be tapped. Management is top rate.

(A Top Pick October 7/16. Up 134%.) They seem to be doing just as well as their US counterparts. A good one to hold.

Canada’s largest e-commerce enabler. Their core clientele are small and medium-sized businesses. They believe there is an adjustable market of 47 million of those. Growing revenues at a torrid pace of up to 75% year-over-year. The company is not profitable yet, but expects to breakeven by the 4^th quarter of this year. An expensive stock, but it is a platform company, i.e., it is entrenching itself in its customers’ business models. They help customers e-commerce businesses with things like inventory management, promotion management, shipping, payments, etc. (Analysts’ price target is $151.)

Was really surprised at the growth metrics underneath this. They are in 500,000 merchant companies in 175 countries with a 60% growth rate in North America, and even higher growth rates elsewhere. (Analysts’ price target is $151.)

It is a very expensive name. SHOP-T is in bed with AMZN-Q. It is a story about technology facilitating online shopping. They are growing very rapidly. They have net cash, even though they are losing money. If it were to crack then investors would sell this name first. The business is very solid. He likes it.

It is tremendously volatile. We had a pop a number of months ago. He suggested at the time that you start playing with options. This might be just a consolidation. He is cautious on this one. Buy into weakness, but don’t chase breakouts, although that is just part of his style of investing. If it breaks support you have to think it is heading into a lower area.

It is very expensive. Look at it as a business. It has a place. It has a crazy multiple. It is awfully dangerous. It is too much of a gamble. Take partial profits if you have some.

A Canadian play that is in one of the most important themes of a secular long-term shift to web commerce. It provides a platform for small to midsize e-commerce companies. They continue to get stronger. They are so strong that Amazon (AMZN-Q) shut down their competitive product to Shopify. In the last quarter, they went from 400,000 users to 500,000 users, companies selling things on the web. Earnings were up about 85% and revenue is up 75%. The downside is that it is a momentum driven company and trades at a very high multiple of about 10X EBITDA to sales. Realistically, if they were to miss or have a miscue operationally, the stock is going to get hurt.

A Canadian success story. He doesn’t own it, because it doesn’t pay a dividend. If you are going to buy this, take a half position and wait for some sort of catalyst to take the other half. Thinks you will do well in the long-term.

Quarterly results came out and the stock has been going sideways. Had an 86% increase in 2^nd quarter revenues. Still not earning any money, but they seem to have a big opportunity in the market. There is lots of room in the market they are operating in, to expand their services. If you want something that is risky, but has lots of potential upside, this is a stock for you. (Analysts’ price target is $151.)

Hasn’t been around long enough to have seasonality. Technically, it has had a huge run, and during the last little while has formed a trading range. In the last 3-4 weeks, it started underperforming the market. Momentum indicators are starting to roll over, which is not good. If you own this, watch the support level very, very closely, because if it breaks that, you will have the establishment of a double top pattern. He would take money off the table.