The Top Software Stocks to Watch According to Mizuho

Investing.com -- As the Canadian tech sector navigates through the end of 2025, investors are focusing on companies that have successfully leveraged artificial intelligence while demonstrating strong execution in their core businesses. BMO analyst Thanos Moschopoulos highlights that the market is beginning to take a more nuanced view in distinguishing between AI winners and losers, creating opportunities for both large and small-cap tech stocks.

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The technology landscape has evolved significantly in 2025, with AI becoming more broadly adopted across enterprises. Companies that were unfairly placed in the "AI loser" bucket may see valuation recovery, while established leaders continue to demonstrate their competitive advantages.

Here’s a look at the top Canadian tech stocks positioned for success in 2026:

Large Cap:

1. Celestica (CLS) - This large-cap standout has achieved triple-digit returns for three consecutive years through 2025. As a leading supplier to major hyperscalers like Google, Meta, and Amazon, Celestica has established itself as a market leader for network switches and servers based on custom silicon. The company’s strong operational execution and growing market share position it well for continued growth, even as AI infrastructure spending evolves. Trading at 25x CY2027 P/E, the stock offers attractive value given its growth trajectory.

BMO Capital Markets recently named Celestica as one of its top large-cap picks in Canadian technology for 2026, highlighting its strong competitive position and growth trajectory.

2. Shopify (SHOP) - Despite headwinds from changes in U.S. trade policy, Shopify’s revenue growth accelerated in 2025, with GMV growth reaching post-pandemic highs. The company continues to dominate in the SMB market while making significant inroads internationally and in the enterprise segment. Shopify’s diversified growth vectors, including offline commerce, B2B expansion, and payments penetration improvements, provide multiple avenues for continued success. The company’s early leadership in agentic AI capabilities further strengthens its competitive position.

In other developments, Shopify has received positive analyst commentary, with firms like Wells Fargo and BofA Securities raising their price targets based on the company’s solid performance and potential in AI.

3. Constellation Software (CSU) - Despite AI-related concerns causing a sharp derating of its stock in 2025, Constellation has maintained consistent business performance with mid-single-digit organic recurring revenue growth. The company’s deep expertise across hundreds of vertical markets creates strong competitive barriers, while its decentralized decision-making provides organizational agility in adapting to AI. CSU has already begun leveraging AI across its businesses, which should drive margin improvements and potentially accelerate organic growth.

Constellation Software’s third-quarter 2025 results showed revenue that was lighter than anticipated, though EBITDA exceeded expectations with margin expansion. Following the report, BMO Capital lowered its price target on the company.

4. CGI (GIB.A) - Despite flat organic revenue growth, CGI achieved 9% year-over-year adjusted EPS growth in FY2025 through M&A, favorable FX, margin expansion, and share buybacks. The company’s exposure to government and financial services sectors (about 60% of revenue) positions it well in verticals with complex regulatory and cybersecurity concerns. CGI’s proprietary IP and R&D investments should help it navigate the AI transition effectively.

CGI reported strong fourth-quarter results, with revenue of C$4.01 billion, up 9.7% year-over-year, and an adjusted EPS of C$2.13, both significantly beating analyst estimates.

Small Cap:

1. Kinaxis (KXS) - This supply chain software provider saw ARR growth accelerate to 17% year-over-year, with EBITDA margins returning to 25%. Trade uncertainties have actually served as a tailwind for Kinaxis, driving pipeline growth and accelerating sales cycles. The company’s AI capabilities are likely to expand its addressable user base within customer organizations, creating upsell opportunities through AI agents sold on a usage-based model.

For its third quarter of 2025, Kinaxis reported earnings per share of $0.93, which surpassed analyst forecasts, although its revenue came in slightly below expectations.

2. MDA Space ( - Despite stock pressure related to customer uncertainties, MDA’s business fundamentals strengthened in 2025. The company secured significant government contracts and is positioned to benefit from increased defense spending and growing demand for LEO broadband capabilities. With multiple large opportunities in its pipeline and strong competitive positioning in satellite communications, one or two major contract wins could significantly impact the stock in 2026.

3. Lightspeed Commerce (LSPD) - Following a strategic review, Lightspeed refocused on targeted verticals within North American retail and European hospitality. Early results show promise, with location count in core markets accelerating to 7% year-over-year growth. The company’s platform capabilities in specific verticals, including supplier networks and regulatory integrations, should help it remain competitive despite larger rivals.

4. Coveo (CVO) - This AI-powered relevance platform demonstrated ongoing growth and marquee customer wins in 2025. Customers are now more educated on generative AI applications for commerce and customer service, leading to larger deal sizes. Coveo’s partnership with SAP has expanded beyond commerce to include service cloud, opening broader opportunities within the SAP customer base.

5. Evertz (ET) - The company has shown continued growth in software/services revenue, which now represents nearly half of its total revenue mix. Improved operational discipline has allowed Evertz to drive operating leverage while maintaining a strong competitive position in its core media/broadcast market. The company’s consistent cash generation supports both regular and special dividends.

As 2026 unfolds, these Canadian tech companies demonstrate that success in the AI era requires both strategic adaptation and operational excellence. Investors should consider both established leaders and undervalued players positioned to benefit from the evolving technological landscape.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Investing.com - European stocks closed Friday’s session mostly in positive territory, posting healthy weekly gains despite a number of significant central bank policy meetings.

The DAX index in Germany climbed 0.4%, the CAC 40 in France was flat and the FTSE 100 in the U.K. climbed 0.6%. 

On a weekly basis, the DAX gained around 0.5%, while the CAC 40 and the FTSE 100 increased by over 1% and 2% respectively. 

Calm after hectic week

Investors appear to be largely resting Friday as a hectic week of economic data and central bank decisions comes to an end.

The European Central Bank maintained its key interest rate at 2%, as widely expected, but upgraded its outlook for economic growth in the eurozone, saying it now expects growth of up to 1.4% in 2025 and 1.2% in 2026.

"The economy has been resilient. It grew by 0.3% in the third quarter, mainly reflecting stronger consumption and investment,” said ECB President Christine Lagarde, at Thursday’s press conference.

Still, sentiment among German consumers is set to fall significantly heading into 2026, according to data released earlier Friday.

The consumer sentiment index, published by the ‍GfK market research institute and Nuremberg Institute for Market Decisions, fell to -26.9 points ‍in January from a slightly downwardly revised -23.4 points.

The Bank of England cut interest rates on Thursday, as widely expected, but uncertainty remains over the U.K. central bank’s next move as several BoE decision-makers highlighted concerns about persistently high wage growth expectations and structural inflation pressures, even as a drop in retail sales in November highlighted a lack of consumer confidence.

The central banks in Sweden and Norway also held policy-setting meetings, and both decided to keep interest rates unchanged, as expected.

EU agrees more aid to Ukraine

Investors are also digesting the news that the European Union leaders have approved an aid package of €90 billion ($105 billion) over the next two years to fund Ukraine’s defence, agreeing to borrow the money rather than use frozen Russian assets.

EU governments had been debating whether to use €210 billion of frozen Russian assets, most of it held in Belgium, to support a so-called reparations loan for Ukraine. 

But in the end the leaders agreed to raise money through joint borrowing backed by the EU budget.

WH Smith cuts full-year profit forecast 

In the corporate sector, travel retailer WH Smith (LON:SMWH) reported a fall in full-year earnings and cut its headline profit forecast for the year ahead, after weaker trading profit offset revenue gains.

Cosmetics company Coty (NYSE:COTY) has sold its remaining 25.8% stake in hair care brand Wella to KKR for $750 million, while retaining rights ‍to a share of any future sale ‍or initial public offering proceeds.

Elsewhere, the shares of German sportswear retailers Adidas (ETR:ADSGN) and Puma (ETR:PUMG) fell after U.S. peer Nike (NYSE:NKE) ‌reported disappointing sales figures out of China, seeing gross ​margins drop for the second consecutive quarter.

Crude set for weekly loss

Oil prices are set for a second straight weekly decline, as persistent concerns about a global supply glut, coupled with rising prospects of a Russia-Ukraine peace deal, offset concerns over supply disruptions from a blockade of ‍Venezuelan oil tankers. 

However, Brent futures is up 0.8% to $60.29 a barrel, and U.S. West Texas Intermediate crude futures have also risen 0.8% to $56.46 a barrel.

Both benchmarks were set to lose over 1% for the week.

On Tuesday, Trump announced a blockade targeting tankers carrying Venezuelan oil that are already under U.S. sanctions, although ​it’s unclear how the U.S. would enforce this announcement to any significant extent.

Trump also said, on Thursday, that he believes talks toward ending the war in Ukraine are "getting close to something" ahead of a U.S. meeting with Russian officials this weekend.

Investing.com – U.K. stocks were higher after the close on Friday, as gains in the Mining, Aerospace & Defense and Oil & Gas Producers sectors led shares higher.

At the close in London, the Investing.com United Kingdom 100 rose 0.85% to hit a new 1-month high.

The best performers of the session on the Investing.com United Kingdom 100 were Fresnillo PLC (LON:FRES), which rose 2.86% or 88.00 points to trade at 3,170.00 at the close. Meanwhile, Rolls-Royce Holdings PLC (LON:RR) added 2.27% or 26.00 points to end at 1,170.00 and Melrose Industries PLC (LON:MRON) was up 1.98% or 11.20 points to 576.60 in late trade.

The worst performers of the session were B&M European Value Retail SA (LON:BMEB), which fell 2.89% or 4.85 points to trade at 162.85 at the close. Frasers Group PLC (LON:FRAS) declined 2.73% or 19.00 points to end at 677.50 and Barratt Redrow PLC (LON:BTRW) was down 2.67% or 10.10 points to 368.70.

Rising stocks outnumbered declining ones on the London Stock Exchange by 961 to 764 and 576 ended unchanged.

Shares in Fresnillo PLC (LON:FRES) rose to all time highs; gaining 2.86% or 88.00 to 3,170.00.

Gold Futures for February delivery was up 0.52% or 22.50 to $4,387.00 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in February rose 0.82% or 0.46 to hit $56.46 a barrel, while the February Brent oil contract rose 0.80% or 0.48 to trade at $60.30 a barrel.

GBP/USD was unchanged 0.01% to 1.34, while EUR/GBP unchanged 0.01% to 0.88.

The US Dollar Index Futures was up 0.20% at 98.28.

Investing.com – Spain stocks were higher after the close on Friday, as gains in the Chemical, Petroleum & Plastic, Financial Services & Real Estate and Building & Construction sectors led shares higher.

At the close in Madrid, the IBEX 35 added 0.22% to hit a new all time high.

The best performers of the session on the IBEX 35 were Acciona (BME:ANA), which rose 2.81% or 5.10 points to trade at 186.50 at the close. Meanwhile, Grifols SA (BME:GRLS) added 2.22% or 0.24 points to end at 11.03 and Mapfre (BME:MAP) was up 1.60% or 0.07 points to 4.32 in late trade.

The worst performers of the session were Telefonica (BME:TEF), which fell 1.72% or 0.06 points to trade at 3.42 at the close. ArcelorMittal SA (BME:MTS) declined 1.45% or 0.56 points to end at 38.10 and Amadeus IT (BME:AMA) was down 1.10% or 0.70 points to 63.00.

Rising stocks outnumbered declining ones on the Madrid Stock Exchange by 112 to 74 and 25 ended unchanged.

Shares in Telefonica (BME:TEF) fell to 52-week lows; falling 1.72% or 0.06 to 3.42. Shares in Mapfre (BME:MAP) rose to all time highs; rising 1.60% or 0.07 to 4.32.

Gold Futures for February delivery was up 0.52% or 22.60 to $4,387.10 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in February rose 0.80% or 0.45 to hit $56.45 a barrel, while the February Brent oil contract rose 0.79% or 0.47 to trade at $60.29 a barrel.

EUR/USD was unchanged 0.03% to 1.17, while EUR/GBP unchanged 0.01% to 0.88.

The US Dollar Index Futures was up 0.20% at 98.28.

Investing.com – Portugal stocks were higher after the close on Friday, as gains in the Basic Materials, Industrials and Financials sectors led shares higher.

At the close in Lisbon, the PSI rose 1.03%.

The best performers of the session on the PSI were Semapa (ELI:SEM), which rose 20.88% or 3.55 points to trade at 20.55 at the close. Meanwhile, Mota Engil SGPS SA (ELI:MOTA) added 3.96% or 0.19 points to end at 5.13 and Altri SGPS SA (ELI:ALSS) was up 1.85% or 0.08 points to 4.41 in late trade.

The worst performers of the session were Ren Redes Energeticas Nacionais SGPS SA (ELI:RENE), which fell 0.93% or 0.03 points to trade at 3.21 at the close. Ibersol SGPS (ELI:IBS) declined 0.40% or 0.04 points to end at 9.90 and Jeronimo Martins SGPS SA (ELI:JMT) was down 0.20% or 0.04 points to 20.26.

Rising stocks outnumbered declining ones on the Lisbon Stock Exchange by 16 to 10 and 3 ended unchanged.

Shares in Semapa (ELI:SEM) rose to 5-year highs; up 20.88% or 3.55 to 20.55.

Brent oil for February delivery was up 0.82% or 0.49 to $60.31 a barrel. Elsewhere in commodities trading, Crude oil for delivery in February rose 0.88% or 0.49 to hit $56.49 a barrel, while the February Gold Futures contract rose 0.50% or 21.90 to trade at $4,386.40 a troy ounce.

EUR/USD was unchanged 0.03% to 1.17, while EUR/GBP unchanged 0.01% to 0.88.

The US Dollar Index Futures was up 0.20% at 98.28.

Investing.com – Netherlands stocks were higher after the close on Friday, as gains in the Oil & Gas, Technology and Healthcare sectors led shares higher.

At the close in Amsterdam, the AEX added 0.48%.

The best performers of the session on the AEX were Prosus (AS:PRX), which rose 2.33% or 1.22 points to trade at 53.54 at the close. Meanwhile, Shell PLC (AS:SHEL) added 1.48% or 0.45 points to end at 30.89 and Exor NV (AS:EXOR) was up 1.11% or 0.80 points to 72.90 in late trade.

The worst performers of the session were Inpost SA (AS:INPST), which fell 1.72% or 0.18 points to trade at 10.29 at the close. ASM International NV (AS:ASMI) declined 1.62% or 8.40 points to end at 509.40 and ArcelorMittal SA (AS:MT) was down 1.60% or 0.62 points to 38.09.

Rising stocks outnumbered declining ones on the Amsterdam Stock Exchange by 52 to 46 and 8 ended unchanged.

The AEX Volatility, which measures the implied volatility of AEX options, was unchanged 0.00% to 21.09.

Crude oil for February delivery was up 0.88% or 0.49 to $56.49 a barrel. Elsewhere in commodities trading, Brent oil for delivery in February rose 0.85% or 0.51 to hit $60.33 a barrel, while the February Gold Futures contract rose 0.50% or 21.80 to trade at $4,386.30 a troy ounce.

EUR/USD was unchanged 0.04% to 1.17, while EUR/GBP unchanged 0.01% to 0.88.

The US Dollar Index Futures was up 0.20% at 98.29.