Shopify Inc. (SHOP.TO)

Recently added this to his “small-cap model” when it broke out through $65. Had a fairly large move, however he thinks the company can continue to add users. Feels the runway for them to add more users is long.

As Amazon (AMZN-Q) is destroying the rest of the retail world, this company is going along for the ride. They facilitate online retailers to use Amazon. They sort of transition a company into Amazon, to help with fulfilment, branding, marketing, searching, etc. Revenues have doubled over the past couple of years and will probably double over the next couple of years. Sitting on $400 million in cash. (Analysts’ price target is $68.41.)

This has done well since going public. There is a lot of momentum behind it. They are in the right space in terms of providing all the back-office systems for online retail, a sector that is growing very strongly. As a value manager, it is difficult for her to buy names like this, because there is so much momentum and the valuation is very high.

This is the most dynamic tech story in Canada, bar none. It was one of the hottest IPOs in 2015. A dominant platform player, and their solution is e-tailing in a box. Their core market is the small-medium-sized businesses, and the solutions they offer are web development, payment processing, order fulfilment, inventory management, sales promotion, management, shipping and even things like receivables and financing. Revenue grew at 89% in the latest quarter. While not profitable yet, they are making all the right strategic decisions, very reminiscent of what Amazon did in its early days. (Analysts’ price target is $68.42.)

(A Top Pick Nov 6/15. Up 29.99%.) He still really likes this and would buy more of it. This continues to try and deliver, and has the potential to do very well.

(Market Call Minute.) He likes the company, but it is super expensive.

A very successful Canadian Tech company. This has done very, very well. If you are helping people to sell on the Internet, you are in a very good space.

(Top Pick Aug 9/16, Up 6.05%) They have a number of avenues of growth.

In spite of the fact that sales were up 62%, earnings were down 14%. He understands the company has an annualized sales run rate of well in excess of $200 million, and analysts are still expecting they are going to lose $.10 in 2017. A PE in 2018 of 161X. Great product, growing like crazy, but unfortunately not making a ton of money. An extremely expensive stock with strong underlying sales growth.

He likes this a lot, although it is not necessarily cheap. Had bought this when it was still private. What is going is very, very positive. They allow small manufacturing and other service organizations to become, in a sense, a part of the Amazon network, which is a huge advantage, and are growing very, very rapidly because of that. He remains bullish and positive on the stock, although he has been taking some profits.

#1 in North America, beating out some of the competition. They have 300,000 clients. They can take a small shop operation and give them all the horsepower that the big guys have. There is lots more market out there that they can penetrate.

The market has seen a massive move towards e-commerce, online shopping, etc. Generally, in the technology world, it is a winner takes all type of proposition. Companies that lead and that can make the investments, generally win. This is trading at a market cap of about $5.5 billion range, and will probably do something like $500 million of revenues next year. A terrific business model. It basically helps small and medium-sized businesses get online. At 10X next year’s sales, would you buy it? If you are a patient growth investor, you can nibble away at this kind of name. The growth rate is upwards of 50% for the next few years. They are the leader in this market.

(Market Call Minute.) A high risk name, but they are the very large successful market and a very good bet.

This fits into the theme of cloud-based computing. The company provides the back end to small Internet retailers. They have something like 300,000 companies that use their infrastructure. The companies pay about $50 a month and can buy additional services to strap onto that. They also get a percentage of revenue of about 1.5%. This company is a long way ahead of its competitors. Something new is that they have also gotten into financing their customers, by taking a royalty on the revenue, so that could be a big new business for them also.

A good company. It is not cash flow positive currently, but it is close. They are getting more and more merchants on the platform which brings in the average revenue per user ad increases. There are more delivery and other services being added, which will increase the operating leverage.