Bitcoin (BTC -0.07%) delivered its worst performance in 2021 of the past three years. And the cryptocurrency still trounced most stocks, with its price soaring more than 60%.
But Bitcoin is off to a rocky start so far this year. Don't be surprised if the digital coin lags behind quite a few stocks over the next 12 months. Here are three unstoppable stocks, in particular, that can beat Bitcoin in 2022.
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1. Innovative Industrial Properties
Sure, Innovative Industrial Properties (IIPR 0.06%) shares are down way more than Bitcoin's price so far this year. However, I suspect the downturn will only be temporary. IIP's business is as strong as ever.
The cannabis-focused real estate investment trust (REIT) added 28 new properties in the fourth quarter of 2021. IIP now owns 103 properties in 19 states. All of the properties are leased to cannabis operators.
While Bitcoin's fortunes are entirely subject to the whims of investors, IIP has a lot more control over how its stock performs. If the company can find more properties to buy and lease, its earnings are likely to continue increasing. And if its earnings grow enough, its share price will almost certainly rise too.
This seems like an easy task for IIP to achieve. There are another 17 states that have legalized cannabis in some form where the company doesn't currently operate. IIP also has plenty of growth opportunities in its existing markets.
Perhaps the greatest threat to IIP is that major cannabis reform at the federal level will be enacted that attracts more competition. However, such reform is as or more likely to be a net positive for IIP as it is to be a negative for the company.
2. PayPal Holdings
The shift to digital payments definitely ranks as an unstoppable trend. PayPal Holdings (PYPL 0.64%) is a top leader in digital payments with 75% of the top 1,500 retailers in North America and Europe supporting its digital wallet. This makes PayPal an unstoppable stock, in my view.
Granted, PayPal didn't look unstoppable last year. Its shares plunged 19% during a bull market for most stocks. A big part of the problem was that the company's revenue growth slowed compared to 2020. But that shouldn't have been a surprise considering the unusually large surge in online buying with the pandemic lockdowns in the previous year.
The consensus Wall Street price target for PayPal stock reflects an upside potential of close to 48%. I think it's quite possible that PayPal could deliver such an impressive gain in 2022.
PayPal's buy now, pay later programs should fuel growth. Amazon.com now supports Venmo for online purchases. New features on the PayPal app (including support for trading Bitcoin and a few other cryptocurrencies) are attracting users. PayPal could bounce back significantly this year. And over the long run, the stock should truly be unstoppable.
3. Viatris
If you thought PayPal was a dubious candidate to beat Bitcoin, you'll probably really think that Viatris (VTRS 1.67%) is a stretch. After all, Viatris performed abysmally last year with its shares plummetting nearly 28%. The company also operates in a boring, slow-growth industry -- biosimilars and generic drugs.
However, analysts predict that Viatris stock could soar more than 30% in 2022. The stock is already up by a double-digit percentage. Why? I think there are two main reasons.
First, the stock is dirt cheap. Viatris' shares trade at less than 3.4 times expected earnings. Investors realize that Viatris is unlikely to become much more attractively valued than it already is. They could believe that there's nowhere to go but up for the stock.
Second, boring is beautiful when the stock market is volatile. Investors turn to the stocks of companies that are viewed as relatively stable and safe. Viatris fits the bill. The biosimilars and generic drugs that it sells should enjoy steady demand for the most part regardless of what the stock market does.
My view is that this "risk-off" mentality is the single biggest risk for Bitcoin in 2022. However, it presents a tremendous opportunity for Viatris.
