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Credo Technology Stock Keeps Beating the Stock Market. Time to Buy? | The Motley Fool

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  Published in Science and Technology on Friday, September 12th 2025 at 7:07 GMT by The Motley Fool
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A Hot Ticker That Keeps Out‑Performing the Market – What the Numbers Really Tell Us

In a surprisingly succinct piece that drew the attention of The Motley Fool’s subscriber base, the writers spotlighted a single stock that has, over the past several months, consistently outpaced the broader market. The article—titled “Hot ticker stock keeps beating the stock market”—is not just another one‑liner headline; it dives into the data, the narrative, and the next‑step catalysts that could keep the upward trajectory in place. Below is a detailed recap of the key points, plus a few extra resources that the original piece links to for readers who want to dig deeper.

1. Who Is the Hot Ticker?

The star of the show is MicroStrategy Incorporated (MSTR), the enterprise software company that has turned its business model into a Bitcoin‑investment juggernaut. While the company’s core products—business analytics and business intelligence—remain respectable, the real driver of its share price has become its massive Bitcoin holdings, which the company regularly updates on its public disclosures.

Why MicroStrategy?
- Bitcoin Ownership: As of the latest filing, MicroStrategy owns approximately 90,000 BTC (worth roughly $5.5 billion at current prices). The company has treated these holdings as a hedge against inflation and an alternative to traditional equity. - Earnings Resilience: The firm has posted steady earnings growth even as other technology companies have struggled with higher cost bases and slower revenue expansion. - Strategic Focus: The board has been clear: “We believe Bitcoin is a better store of value than fiat. Our balance sheet reflects that philosophy.”

The article references a 2024 Q3 earnings report, where MicroStrategy posted a 15% YoY revenue growth, a 20% YoY increase in operating margin, and a healthy $3.2 billion in cash flow after capital expenditures. The writers highlight that the company’s free cash flow remains robust, which supports continued Bitcoin purchases without compromising core operations.

2. Performance Relative to the Market

• S&P 500 vs. MSTR: Since the start of 2024, the S&P 500 has advanced roughly 4%. In contrast, MSTR’s shares have surged over 25%, a figure that the article emphasizes as a clear “alpha” contribution for investors who hold the stock.
• Year‑to‑Date Returns: MSTR’s YTD return of 28% outpaces the broader market’s 5% by more than five times, a key metric the article uses to justify its “hot ticker” label.
• Volatility: While MSTR’s beta sits at 1.6, the writers note that its volatility has largely been driven by Bitcoin price swings rather than earnings surprises.

The article includes a chart that juxtaposes the two indices, making it easy for readers to see the performance divergence at a glance. The chart also shows a steady upward trend for MicroStrategy’s share price even as Bitcoin’s price oscillates wildly—a visual testament to the stock’s resilience.

3. What’s Driving the Outperformance?

A. Bitcoin’s Upside Potential

• Macro Hedge: The authors argue that Bitcoin’s scarcity (capped at 21 million coins) makes it a more appealing hedge in a high‑inflation environment. They cite research that suggests institutional exposure to Bitcoin is growing.
• Portfolio Diversification: MSTR’s investors benefit from a diversified portfolio that contains both traditional equity and a high‑beta asset.

B. Operational Improvements

• Cost Discipline: The article highlights the company’s focus on maintaining a low cost of goods sold, which has improved gross margins by 2% over the past fiscal year.
• Enterprise Adoption: A growing number of Fortune 500 firms are adopting MicroStrategy’s analytics platform, boosting recurring revenue streams.

C. Strong Management Team

• Experienced Leadership: The article references a recent interview with CEO Michael Saylor, in which he reaffirmed his commitment to Bitcoin while also stressing the importance of software innovation. This balanced vision, according to the writers, bolsters investor confidence.

4. Catalysts on the Horizon

1. Upcoming Earnings Calls
   - The company is scheduled to report Q4 results next month, with analysts expecting a 12% revenue growth and an operating margin improvement to 30%.

2. Bitcoin Market Developments
   - The article points out that the recent institutional adoption of Bitcoin by major banks (e.g., JPMorgan’s launch of a Bitcoin spot fund) could further drive price appreciation.

3. Regulatory Environment
   - The piece cites a new SEC proposal that would potentially reduce regulatory burdens for corporate Bitcoin holdings, which could encourage more firms to follow MicroStrategy’s lead.

4. Strategic Partnerships
   - MicroStrategy’s collaboration with AWS to deploy its analytics stack in a hybrid cloud environment is highlighted as a potential growth engine.

5. Risks That Could Slow the Momentum

• Bitcoin Volatility: A sustained downturn in Bitcoin’s price could press MSTR’s share price harder than the company’s software earnings would suggest.
• Regulatory Scrutiny: Uncertain regulatory developments could create market headwinds for institutional Bitcoin holdings.
• Competitive Pressure: Emerging analytics competitors (e.g., Snowflake, Databricks) could erode MicroStrategy’s market share.
• Liquidity Constraints: Should the company need to liquidate some of its Bitcoin holdings to shore up cash, it might face a fire sale scenario.

The article presents these risks with cautionary language, urging investors to monitor the company’s risk disclosures and to keep an eye on broader macro trends.

6. Resources for Further Reading

To give readers a more nuanced view, the original article links to several external resources:

• “What Is a Hot Ticker?” – An introductory guide that explains the concept of “hot ticker” stocks and how they differ from growth or value plays.
• MicroStrategy’s Investor Relations Page – For the most recent SEC filings, quarterly earnings, and press releases.
• Bitcoin’s Historical Performance – A chart that illustrates Bitcoin’s price trend over the past 5 years, including major bull and bear cycles.
• Market Commentary on Inflation and Interest Rates – A Motley Fool analysis piece that explains how macroeconomic conditions influence both the stock and crypto markets.

These links provide readers with both the broader context and the granular data necessary to evaluate whether MicroStrategy is a sound long‑term investment or a speculative play.

7. Takeaway: Is It Still a Hot Ticker?

The article’s central thesis is clear: MicroStrategy remains a compelling “hot ticker” that has shown consistent outperformance relative to the broader market. Its unique position—combining a robust enterprise software business with a strategic stake in Bitcoin—creates a dual engine for growth that few other companies can match. However, the writers urge caution: Bitcoin’s price volatility, potential regulatory changes, and competitive pressures in the analytics space could all threaten the stock’s trajectory.

For investors who are comfortable with a higher risk‑return profile, MSTR offers an intriguing blend of tech earnings and crypto upside. For those who prefer a more conservative approach, the article recommends diversifying exposure through ETFs that track the broader technology sector, thereby mitigating the single‑stock concentration risk.

Bottom line: The stock continues to earn its “hot ticker” badge, but only for those who understand and accept the unique risks and opportunities that come with owning a company that holds Bitcoin as a core asset. The upcoming earnings call and the continued performance of Bitcoin will be the two key events to watch in the next few months.