The Magnificent Seven are magnificent for a purpose. These shares have grown in dimension yr after yr, even decade after decade, investing virtually a no brainer. However of all of them, there’s one which I would definitely contemplate shopping for on a ten% dip, and that’s Microsoft (NASDAQ:MSFT). It may not be the biggest of the most important seven, however its stability and development are unmatched. So let’s get into this tech inventory, together with one other Canadian choice buyers may need to contemplate for even faster development.

Purchase the dip

Now it’s vital to notice that Microsoft inventory isn’t precisely going to surge in share value prefer it did a couple of a long time again. The expansion is there, and it’s nonetheless extremely engaging, however that is now a buy-and-hold inventory. And actually, as an investor, I’m very happy with that.

That is very true because the latest earnings announcement. Throughout Microsoft’s fourth quarter and full-year report, the corporate supplied a blowout report. Income climbed 18% to US$76.4 billion, working revenue was up 23% to US$34.3 billion, internet revenue was up 24% to US$27.2 billion, and earnings per share (EPS) have been at US$3.65, up 24% as properly. What’s extra, the tech inventory reported extra development is on the best way. Microsoft cloud income, as an illustration, grew 27% to US$46.7 billion and Azure was up 39%.

In the meantime, the inventory additionally managed to return US$9.4 billion to shareholders by way of dividends and buybacks whereas sustaining a stability sheet that swelled to US$619 billion! The one subject? You’re paying for that worth, with price-to-earnings (P/E) buying and selling at a ahead 33 occasions earnings. Worth to gross sales (P/S) can also be excessive at 13.5 occasions gross sales. All thought-about, it’s not an revenue story by way of dividends, however a powerful, core compounder for long-term holds, particularly if there’s a ten% pullback.

Or, purchase now?

Now, since everybody is aware of about Microsoft inventory and its historical past in addition to its future, that 10% dip doesn’t look too seemingly within the close to future. Nevertheless, there’s a tech inventory to think about that provides loads of the identical alternatives, at a beneficial share value, and that’s OpenText (TSX:OTEX).

The primary subject with OpenText inventory is that it’s going by way of a transition, specializing in agentic synthetic intelligence (AI) for enterprise corporations. This transition could be scary for some buyers, however long-term buyers can get in on a re-rating and money yield. Oh, and naturally, main worth. Whereas income dropped 3.8% over the past quarter, shares are low cost, buying and selling at 8.9 occasions earnings. Due to this fact, the market expects an earnings rebound.

The opposite profit is that buyers acquire a 3% dividend yield with a payout at 64%, with free money stream (FCF) protecting it. So buyers can acquire entry to a tech inventory offering a dividend whereas ready for a turnaround for long-term development, and at a a lot decrease price.

Backside line

So, which ought to buyers purchase available on the market immediately? If you need the best high quality as your long-term maintain, a premium can maintain up even when shares look costly, particularly from a Magnificent Seven inventory like Microsoft inventory. But it’s positively expensive.

In the meantime, if you need a yield and a less expensive inventory with the potential for increased development, OpenText is usually a nice choice for much less risk-averse buyers. But buyers might go along with each, utilizing Microsoft inventory as a core place, with OpenText as a worth alternative. All collectively, these two tech shares could possibly be incredible alternatives for any investor to think about.