What to buy as U.S. inflation hit a new 40-year high

By: Wajeeh Khan
Wajeeh Khan
Wajeeh is an active follower of world affairs, technology, an avid reader, and loves to play table tennis in… read more.
on Jan 12, 2022
  • Inflation in the United States climbed to a new 40-year high in December.
  • Malcolm Ethridge says PayPal and Iron Mountain will still do good in 2022.
  • He discussed his outlook on the stocks on CNBC's "Worldwide Exchange".

Consumer prices in the U.S. climbed to a new 40-year high in December, but CIC Wealth’s Malcolm Ethridge says some stocks can withstand the inflationary pressures and do good in 2022.

Ethridge’s bull case for PayPal

One such name that pops out to him is PayPal Holdings Inc (NASDAQ: PYPL). Ethridge’s positive view on the fintech giant is primarily based on its acquisition strategy. On CNBC’s “Worldwide Exchange”, he said:

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We expect PayPal to put its $5.0 billion worth of expected free cash to work later this year. They’ve done a decent job expanding into the Japanese market last year. We expect them to continue to push into the Asian markets this year. I think they’ve identified a few targets as well.

Shares of the online payments company have come down nearly 40% in less than six months that, as per Ethridge, makes up for a great opportunity to buy the stock and be a part of its aggressive growth plan.

According to Kansas City Fed, PayPal could replace credit cards in the foreseeable future.

What else does Ethridge like for 2022?

His second pick for 2022 is Iron Mountain Inc (NYSE: IRM) – a Boston-based document storage company that, Ethridge says, is suitable for investors who want to play the REIT space. He added:

It serves as both a growth and an income play. With a 5.0% dividend, it’s a perfect way to play the REIT space, but it doesn’t necessarily take you on the same wild ride that a lot of the REITs do because it’s basically a data storage management company.

IRM closed 2021 with a 75% gain in the stock market, but Ethridge expects the rally to continue this year.

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