It may seem like every stock is crashing these days. Electric vehicle giant Tesla is down 18% since the start of 2022, and the price of Bitcoin has also fallen by a similar amount. The S&P 500 also isn't faring well, falling more than 10% this year.
But there have been some stocks off to fast starts as well. Shares of both Jushi Holdings (JUSHF -3.92%) and American Express (AXP -0.08%) are up more than 14%, even as the markets have been wobbly. What's so special about these stocks, and is it too late to jump on their bandwagons?
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1. Jushi Holdings
Jushi Holdings is a top cannabis producer growing its presence across the country. The multistate operator (MSO) opened its 28th nationwide retail location in December 2021, which is also its 18th dispensary in Pennsylvania. The state is a key market for Jushi, although pot remains illegal in the state for recreational use. However, support for legalization is at record highs, with 60% of voters favoring it.
Meanwhile, nationally, Senate Majority Leader Chuck Schumer has been spearheading the talk of legalizing marijuana at the federal level. This month, he asked for input from colleagues to help finalize a bill relating to cannabis that could be introduced as early as this spring. Legalization would allow MSOs like Jushi to freely enter more states and expand their operations while also shipping products across state lines, something that isn't possible today.
The bullishness in Jushi's stock could be tied to hopes surrounding legalization, and it may also just be a modest recovery from the sell-off that took place last year; in 2021, while the S&P 500 was soaring 27%, Jushi's stock fell by 44%.
Given that the pot stock has some promising potential, growth-oriented investors may be seeing this as an opportunity to buy Jushi at a more favorable price. At a price-to-sales multiple of 3.9, similarly valued like Trulieve Cannabis but cheaper than Curaleaf Holdings, which trade at 3.9 and 5.1 times their sales, respectively.
In its most recent earnings report (period ending Sept. 30, 2021), Jushi's quarterly revenue of $54 million rose by 117% year over year. Its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $6.4 million also more than doubled.
Jushi has been delivering some strong growth numbers of late, and if it can continue to do so, it may not be all that surprising for the stock to continue generating strong returns for investors this year.
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2. American Express
American Express isn't coming off a bad 2021; its shares were up over 35% last year. Instead, the stock is just building off of that bullishness. Unlike other card companies, including Visa and Mastercard, which are only up 3% this year, American Express has been outperforming them by wide margins (it also handily outperformed them in 2021).
The company reported its latest earnings numbers in January, and its total revenue, net of interest expense, totaled $12.1 billion for the last three months of 2021. That marked a 30% increase year over year. And net income of $1.7 billion also jumped by 20%. The numbers exceeded the company's expectations as AmEx noted record spending during the period.
AmEx is known for its popular travel-focused cards, and a resurgence in the economy could lead to more corporate spending this year and thus, a further boost to its financials. Plus, Amex does more than just credit cards, as it also helps companies bring down their costs by automating the accounts payable process, for example. As a trusted partner for many businesses, AmEx may be in excellent shape to continue to outperform the markets as two key spending areas, travel and entertainment, are normally catalysts for the company's growth.
Even now, with the stock amassing such impressive gains, AmEx may still be a better buy than its peers. Trading at a forward price-to-earnings multiple of 20, it looks like a bargain compared to both Visa and Mastercard, which trade at 31 and 35 times their future profits, respectively.
