Strivers: 3 Canadian Tech Stocks That Could Turn It Around in 2024

In the last 12 months, the tech sector’s performance has broadly mimicked the market’s performance – fluctuations in the first half and a bull market phase in the second. And following the market’s pattern, the tech sector has gone bearish in the last few weeks. But a few tech stocks have been bearish/weak for a long time now, and three of them might turn things around before 2024 is over.

A customer experience (CX) focused tech company

Telus International (TSX:TIXT) is a Vancouver-based software company specializing in digital customer experiences (CX), though it’s also expanding its range in AI services.

This includes AI data solutions and a range of other solutions that complement their customer-experience end of business, including AI chatbots. Another interesting “characteristic” of this company is the Telus name, the subsidiary of the telecom giant.

However, despite an impressive parent company, the tech stock has disappointed most of its investors from the beginning. It’s trading at a 74% discount from its IPO price, but there are two reasons to be hopeful about the company’s recovery within the year.

The first is its AI services, which may allow it to garner more investor attention. The second is that in the past 12 months, it did follow the sector’s overall performance pattern (to an extent), so once the industry goes bullish again, the stock might follow.

An IT solutions provider

Toronto-based Softchoice (TSX:SFTC) has been around since 1989, but it has only been a publicly traded company since 2021, and its performance so far could have been better. While its decline was not as drastic as Telus International’s, the stock has mostly gone downward since its inception, apart from a brief spike initially. It’s also trading at an 18.5% discount from its IPO price.

Softchoice offers its customers a wide range of services, including Cloud, one of its most significant revenue-generating segments. The revenues and the 2,000-plus team size are not consistent with its relatively modest market capitalization of $1 billion, but they reflect the accurate scale of the business.

The financials are stable, the company has minimal debt, and it’s quite attractively valued. These are the hallmarks of a stable business, ready to thrive in the right market conditions.

An e-commerce company

Calling Lightspeed (TSX:LSPD) an e-commerce giant that lives in the shadow of Shopify may not be entirely accurate. Still, investors have been drawing parallels ever since Lightspeed was listed on the stock market.

However, that changed once the company became the target of a short-seller report, which triggered a slump, and the stock still needed to recover. It’s trading at an 88% discount from its 2021 peak.

However, things might be getting better for the company. The financials of the company are steadily improving, and it has reduced its debt to almost nothing while having a massive amount (comparatively) of cash and short-term investments. Financially, Lightspeed is a healthy company, and even by the least forgiving estimates, it’s trading below its intrinsic value.

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Foolish takeaway

All three tech stocks might turn things around by the end of this year. Two stocks may rely upon a bullish tech sector for recovery, while Lightspeed may leverage exceptional returns or solid growth to reclaim investors’ trust.