Often when ASX stocks have risen strongly, investors will think they have missed the boat.
They may then think it's better to wait for a pullback to happen in order to try and get in at a better price.
While sometimes this may happen, more often than not, high-quality, sizzling hot ASX stocks don't come back to earth in a hurry.
Or at least, if they do, they've already gone another 25% higher before pulling back 10%. This means you end up paying more than you would have done if you just snapped them up earlier.
With that in mind, let's take a look at a couple of ASX stocks that are sizzling hot and could still offer great returns for investors. They are as follows:
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Megaport Ltd (ASX: MP1)
This elasticity connectivity and network services interconnection provider's shares are the epitome of sizzling in 2024. Since the start of the year, the ASX stock has risen approximately 40%. This extends its 12-month return to 120%.
The driver of this has been the release of a strong quarterly update. Megaport reported total revenue of $48.6 million and EBITDA of $30 million, which was well ahead of expectations.
Analysts at Macquarie believe the strong form can continue. In response to the update, the broker has put an outperform rating and $15.50 price target on its shares. This implies 20% upside for investors.
NextDC Ltd (ASX: NXT)
Another ASX stock to look at is data centre operator NextDC. Its shares have rallied approximately 40% over the last 12 months and more than 120% since the start of 2020.
Investors have been buying the company's shares due to its strong top line and profit growth, which is being underpinned by the insatiable demand for capacity in its data centres. Pleasingly, this is only expected to continue to increase as generative AI drives a third-wave of demand.
The team at UBS still sees a lot of value in its shares. It has a buy rating and $17.20 price target on them, which suggests almost 20% upside.
