The trading app Robinhood publishes a list of its most popular stocks, and among those you can find quality companies to hold over the long term. Here are two stocks on the list that look poised to outperform because of their innovative business models and long-term growth drivers. 

The first pick is Beyond Meat (NASDAQ:BYND), a leader in the fast-growing market for meat substitutes. And the second is Penn National Gaming (NASDAQ:PENN), a casino operator with a convincing pivot to digital sports betting. Let's see why these stocks would make great buys in 2020. 

Money in a jar

Image source: Getty Images.

Beyond Meat

Beyond Meat is one of the most innovative names in the food industry. The company manufactures and markets plant-based meat substitutes that closely mimic the taste and texture of real beef. Sales are soaring, and Beyond Meat looks poised for continued growth because of its retail expansion and new product launches. 

The company reported strong second-quarter earnings on Aug. 4, but the market seems to have judged the company too harshly with the stock down 11% since. This correction looks like an opportunity to scoop up the stock at a discount to benefit from its long-term growth drivers.

While analysts are justifiably worried about Beyond Meat's exposure to the impacts of COVID-19 in the food service industry, the company's surging retail distribution channel can make up for the weakness.

In the second quarter, net revenue increased 69%, year over year, to $113.3 million. U.S. retail sales rose 195%, from $30.5 million to $90 million  as the company's products were stocked at more locations, including Walmart's Sam's Club and BJ's Wholesale Club. This triple-digit growth in retail sales helped offset soft food-service sales, which only increased 16%, from $25 million to $29 million.

Beyond Meat can drive continued growth through research and development. The company spent 6.9% of its revenue on R&D -- much higher than most other food companies -- and is rolling out products like Beyond Fried Chicken and the Beyond Breakfast Sausage.

Penn National Gaming

This is one of the most popular stocks on Robinhood. Despite the coronavirus pandemic, Penn's shares have soared 103% year-to-date while the Dow Jones U.S. Gambling Index is down 18%. And it isn't hard to see why: The meteoric rise of online sports betting business, the stock. But before we look at its growth drivers, let's assess the damage from the coronavirus pandemic.

Penn National's second-quarter earnings report on Aug. 6 showed the impact of the pandemic. Total revenue fell 77% to $305.5 million because of a significant drop in gaming revenue with casinos closed. But the company did a good job slashing operational costs, which helped hold the damage to a total net loss of just $214.4 million in the period.

The market didn't punish Penn National for the weak earnings, with the stock up 27% since the report. Investors seem confident in Penn National's ability to rebound from the crisis, and drive continued long-term growth through sports betting. The physical casinos are now open, and management is reporting breakneck growth in the company's online offerings.

Penn National's iCasino in Pennsylvania grew 108% in the second quarter and now claims a 10% market share in the state. The company is also rolling out its Barstool Sportsbook mobile app, which is scheduled for a Pennsylvania launch in September with a multiple-state rollout over the next three quarters.