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3 Unstoppable Stocks to Buy in 2022

By Keith Speights – Jan 3, 2022 at 5:52AM

Key Points

  • Innovative Industrial Properties has a tried-and-true formula for success that's easily repeatable.
  • Intuitive Surgical is set to continue dominating the fast-growing robotic surgical systems market.
  • Sea Limited continues to grow rapidly in three hot areas -- gaming, e-commerce, and digital payments.

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These stocks should steamroll anything that gets in their way.

You wouldn't be reading this if you wanted to learn about stocks that have gigantic obstacles in their paths. There are plenty of them, though.

Of course, every stock has some potential challenge that could limit its success. However, some have so much going in their favor that they're likely to steamroll over anything in their way. Here are three such unstoppable stocks to buy in 2022.

A person holding a coffee cup while looking at a laptop.

Image source: Getty Images.

1. Innovative Industrial Properties

Innovative Industrial Properties (IIPR 2.21%) keeps it simple. The real estate investment trust (REIT) buys properties from licensed cannabis operators needing an influx of cash. It leases those properties back to the cannabis operators. And then it uses the resulting cash flow to repeat the process -- over and over.

This model has worked amazingly well for IIP so far. Over the past three years, its revenue and earnings have skyrocketed more than 12X and 15X, respectively. Its share price has vaulted more than 470% higher during the period. 

But IIP is only scratching the surface of its opportunity. The company still owns only 103 properties in 19 states. There are over 28,700 cannabis growers in the U.S., according to market researcher IBISWorld. And 36 states have legalized medical and/or recreational cannabis.

The biggest threat to IIP is that federal cannabis reform could lead to increased competition. However, such reform would also almost certainly expand the U.S. cannabis market. It's likely that the net impact on IIP would be positive. With considerable uncertainty about if and when federal cannabis laws might be changed, IIP appears to be in a great position to continue repeating its formula for success.

2. Intuitive Surgical

Robots are used in manufacturing to perform repetitive processes with high levels of precision and consistent quality. Intuitive Surgical (ISRG 4.89%) achieves these same goals with its robotic surgical systems.

The company dominates the robotic surgical system market with a market share of nearly 80%. More than 6,500 of its da Vinci systems are installed in 67 countries. Intuitive recently hit a major milestone, reaching 10 million surgical procedures performed with its robotic systems. 

Don't think for a second that Intuitive Surgical's high-growth days are over, though. The company could expand its market by roughly 4X with its current products and regulatory clearances. And it's developing new products and seeking additional regulatory clearances that could more than triple that market opportunity.

Sure, Intuitive has more competition now than it did in the past. However, no rival offers the track record, ecosystem, and analytics that Intuitive does. This growth stock truly looks like one that you can buy and hold forever.

3. Sea Limited

Think of trends that are practically unstoppable. I suspect that gaming, e-commerce, and digital payments rank near the top of the list for many people. Sea Limited (SE -1.54%) stands as a leader in all three areas.

The company makes over 40% of its revenue (and all of its profits, for now) from its digital entertainment business. Sea's Free Fire is the highest-grossing mobile game in Latin America, Southeast Asia, and India. It has also been the highest-grossing mobile battle royale game on Alphabet's Google Play in the U.S. for three consecutive quarters. 

Sea Limited also appears to be on its way to becoming an e-commerce juggernaut. The company's Shopee is the second-most downloaded e-commerce app in the world on Google Play. And it ranks first in total time spent on the app in the shopping category. 

Shopee's success has helped pave the way for Sea to move into digital financial services. The company's mobile wallet total payment volume reached $4.6 billion in the third quarter of 2021. 

Sea's main vulnerability is its dependence on Free Fire. However, the company has launched new features that keep users returning to the mobile game and also attract new users. With its robust growth in e-commerce and digital payments, Sea should continue to reduce its reliance on Free Fire in the future.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Keith Speights owns Alphabet (A shares), Innovative Industrial Properties, Intuitive Surgical, and Sea Limited. The Motley Fool owns and recommends Alphabet (A shares), Alphabet (C shares), Innovative Industrial Properties, Intuitive Surgical, and Sea Limited. The Motley Fool recommends the following options: long January 2022 $193.33 calls on Intuitive Surgical and short January 2022 $200 calls on Intuitive Surgical. The Motley Fool has a disclosure policy.

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