There are plenty of hot stocks in this market that investors are watching closely. This year, many of these sizzling high-performing equities continue to see high demand, as these growth stocks outperform the broader indices. However, with the stock market seeing a dip in recent days, investors have to ponder whether it’s time to rotate toward more defensive, value-oriented names.
Personally, that’s the way I’m going. However, I can see the case for why investors would want to stick with the stocks that are winning. Indeed, selling one’s winners and rotating into underperforming stocks can be a losing strategy over the long term. That’s because winners tend to keep winning and can often catch up to what may appear to be lofty valuations at a given point in time.
With that said, let’s look at two hot stocks long-term investors may want to stick with moving forward.
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Alimentation Couche-Tard
Alimentation Couche-Tard (TSX:ATD) is an international convenience store licensor and operator. Apart from its home country of Canada, it runs operations in North America, Asia, and Europe. In fact, most of Couche-Tard revenue is generated outside Canada, making this a great stock for those concerned about currency-related over-exposure to the Canadian or North American markets.
Recently, Couche-Tard entered an agreement to acquire some of TotalEnergies’s Europen assets. It includes a 100% acquisition of the latter’s retail assets in the Netherlands and Germany, along with a 60% controlling interest in the ones in Luxembourg and Belgium. This move will significantly increase the company’s hold over the European market.
Couche-Tard’s value as a convenience store and gas station operator is in the company’s acquisition strategy. That’s how Couche-Tard has created the kind of long-term growth investors see in the chart above. And it’s how the company will continue doing so moving forward.
Importantly, the company recently announced a dividend of $0.14 per share for this past quarter. This dividend amounts to a dividend yield of only 0.8%, but it’s really icing on the cake for this high-growth gem.
Riot Platforms
Riot Platforms (NASDAQ:RIOT) is a North American Bitcoin mining organization. This hot stock operates via three segments: Bitcoin mining, engineering and data centre hosting, along with providing critical infrastructure and co-location services for other institutional-level Bitcoin mining firms.
The company’s Bitcoin mining operations have been impressive, with the company earning power and demand response credits worth US$31.7 million over the last month. This is a new monthly record in Riot’s books, making it one of the cheapest Bitcoin mining platforms in the industry. It will also help the organization gain a leading position in next year’s Bitcoin halving event.
Additionally, by 2023’s end, Riot aims to achieve 12.5 EH/s (exahashes per second) total self-mining hash rate capacity in its Rockdale facility. It also has a long-term purchase deal with MicroBT to acquire next-gen Bitcoin miners with a hashing capacity of 7.6 EH/s. By mid-2024, this company will have an approximate total self-mining hashing capacity of reach 20.1 EH/s.
Apart from this, Riot had a noteworthy performance in the second quarter of 2023. It had total revenue worth US$76.7 million, power curtailment credit earnings of US$3.5 million and mining revenue worth US$49.7 million. The company’s profits from data centre hosting and engineering stand at US$7.7 million and US$19.3 million, respectively.
That’s the kind of growth investors like to see, and it’s reflected in Riot’s stock price performance this year.
