By now any electric vehicle (EV) stock enthusiast is well aware of 2021’s trajectory for EV stocks. The sector is very much one that plays follow the leader. So the market went up for about the first week of this year and then volatility and downward momentum set in.
Generally speaking, no matter which individual EV shares an investor held, the pattern was the same: Downward price momentum into mid-May which marked an inflection point. Since then prices have generally been flat to upward.
That broadly indicates momentum for the short term which is always a good sign. However, the time frame of this article isn’t the next few months. When we discuss stocks that will ride out the race to the top, as the title of this article suggests, we clearly have a different meaning in mind.
That means we’re talking about the wheat amongst the chaff. After all is said and done these are the electric vehicle companies that look worthy of investing in for the long run. There should be a few surprises here so let’s get into it.
- Tesla (NASDAQ:TSLA)
- Fisker (NYSE:FSR)
- Lucid (NASDAQ:LCID)
- ChargePoint (NYSE:CHPT)
- Global X Autonomous & Electric Vehicles ETF (NASDAQ:DRIV)
- Nio (NYSE:NIO)
- Xpeng (NYSE:XPEV)
EV Stocks That Will Race to the Top: Tesla (TSLA)Source: Grisha Bruev / Shutterstock.com
I’d posit that any list of electric vehicle stocks discussing the race to the top and the long run ought to begin with Tesla. I mentioned that the EV stocks are very much a follow the leader type of sector. Clearly I was referring to Tesla when I wrote that.
As Tesla goes so go all the other EV stocks. That’s simply because it has already won the race to the top. It is a pioneering force in electric vehicles. Despite personal opinions of Elon Musk, you have to admit that what he has done is amazing.
Tesla had its breakout year in 2020. It paved the way for all other electric vehicle manufacturers, and while the company isn’t perfect, it deserves investor capital. The company was founded in 2003, began production of its Model S in 2012, Model 3 in 2016. There have been plenty bumps along the road in TLSA’s rise to prominence.
You really have to give it kudos. These days TSLA stock is moving on news related to self-driving software releases and updates.
The company is aiming for a wider release of its Full Self-Driving beta software by the end of September. Elon Musk has been promising wiser roll outs of full self-driving software for Tesla vehicles for quite some time. So users and investors alike are already wary. Ultimately though, Musk has proven again and again that he achieves what he sets his mind to.
That track record makes Tesla a sure fire buy for long-term electric vehicle stocks.
Fisker (FSR)Source: T. Schneider / Shutterstock.com
For investors who’ve been watching Fisker over the past few quarters a clear narrative has emerged: The company’s strategy for its first vehicle, the Ocean SUV, seems solid and logical. That should put the company off on the right foot when Oceans begin rolling off the assembly floor in Q4 of 2022.
Fisker’s strategy here is that it has outsourced the manufacturing of the Ocean to Magna International (NYSE:MGA). Magna is among the most proven Original Equipment Manufacturers (OEMs) for vehicles worldwide, with the move being heralded as a conservative but smart choice.
The company anticipates that volume will reach 5,000 units per month in 2023. It also maintained a cash balance of $962 million by the end of the second quarter. The bull thesis here is that the Fisker Ocean will roll off the assembly line with far fewer hiccups due to Fisker’s asset light approach. Therefore, financial results should be better than if Fisker manufactured in house.
I would bet on the Ocean being a solid vehicle. The bigger risk relates to Fisker’s second vehicle, Project Pear. It also relies on outsourced manufacturing, this time to Foxconn. That project has hit massive snags and is rife with complaints.
So not only is Fisker attempting to release two vehicles before its first comes off the production line, it’s relying on two vastly different manufacturers. Magna is steady and proven, and Foxconn is burning bridges in America’s heartland.
The risk is clear here. If Fisker loses, it won’t be because of the Ocean.
EV Stocks That Will Race to the Top: Lucid (LCID)Source: ggTravelDiary / Shutterstock.com
Lucid is very young. So calling it a stock that will ride out the race to the top may seem a bit premature.
But for investors who like Tesla, Lucid is almost a carbon copy chance at similar price appreciation. The company’s Lucid Air lineup is aimed squarely at dethroning the Tesla S for EV luxury sedan dominance. It has multiple offerings within the lineup that slot nicely against Tesla S versions. Peter Rawlinson, Lucid’s CEO, was a chief engineer on the Tesla S model while VP of vehicle engineering at the company.
Lucid, like Tesla, is building its own manufacturing footprint in the U.S. The greenfield site in Casa Grande, Arizona is undergoing expansion. It will have the capacity to produce 365,000 vehicles annually and will reach 5.1 million sq ft following the 2.7 million sq ft update. That expansion will allow the company to produce its first SUV, Project Gravity, in 2023.
The other good news is that Lucid recently received its first analyst rating. Citigroup analyst Itay Michaeli gave it a buy rating and a $28 target price stating: “Lucid resembles much of what we like about Tesla, but without the lofty 2030 [market] share and [self driving] outcomes that one must underwrite.”
ChargePoint (CHPT)Source: YuniqueB / Shutterstock.com
Investors who glance at Chargepoint’s price chart throughout 2021 may be less than enthusiastic about its prospects. After all, it has essentially halved from its highs in the $40s.
But the truth is that both the short term and long term are bright for the EV charging network company.
ChargePoint’s second quarter earnings beat analyst expectations posting $56.1 million while analysts expected $49 million. The company did post earnings which were arguably disappointing though. The company was expected to post an earnings loss of 12 cents. They instead posted a loss of 13 cents. While that’s not a great difference, posting losses beyond what analysts expect isn’t exactly a good look.
But growth companies are primarily judged upon their ability to increase sales. Operational efficiency and earnings are problems to be tackled further down the line.
And ChargePoint is bullish in its own ability, having raised guidance moving forward. Management is forecasting between $60-$65 million in sales while analysts expect $62 million. That has led the company to increase guidance for 2021 sales to $230 million from $200 million earlier.
The company is already a leader in the EV charging space and President Joe Biden’s infrastructure spending plans prioritize ChargePoint’s services. Look for ChargePoint to emerge as a dominant force in the space.
EV Stocks That Will Race to the Top: Global X Autonomous & Electric Vehicles ETF (DRIV)Source: buffaloboy / Shutterstock.com
Another way to win in the ride to the top of the EV scramble is to play it safe. In this case that means investing in DRIV stock. The Global X Autonomous & Electric Vehicles ETF provides exposure to exchange-listed companies in electric and autonomous vehicles.
It is modeled after the Solactive Autonomous & Electric Vehicle Index, which is itself a great resource for understanding the broader components that make up the EV market.
In any case DRIV shares are going to provide safer exposure to EV stocks than any individual stock can. The ETF carries a beta of 1.44 meaning it moves 44% more than its index. Tesla’s beta is 1.96 over the past 5 years for the sake of comparison.
Tesla is the first EV company to show up on the ETF’s top ten holdings at first place. It includes Alphabet (NASDAQ:GOOG, GOOGL) for its autonomous vehicle development and chip companies like Nvidia (NASDAQ:NVDA) and Qualcomm (NASDAQ:QCOM) as well.
Investors get broad exposure to EV growth and overall strong companies while also receiving a small dividend yielding 0.27%.
Nio (NIO)Source: xiaorui / Shutterstock.com
Although I’m an ardent believer the next two Chinese EV stocks on this list will emerge as great EV companies of the decade, they are volatile.
In the case of Nio, recent news of a $2 billion share offering in the past fews days has sent prices down. The news took prices from $40 down to $38. However, they’ve shown resilience and have since begun to trend upward.
The 3% dilution didn’t seem to affect stock prices for long. Nor did the fact that Nio choose to raise capital through its U.S. ADRs even as Chinese U.S. listed stocks face continued concerns.
Naysayers will continue to nitpick at Chinese companies including Nio. Yet, at the end of the day the company has what investors look for in growth companies: Rising sales and deliveries. Well, sort of anyway.
The company actually had to pull back on previous Q3 delivery guidance of 23,000 to 25,000 vehicles due to supply chain constraints. It now anticipates 22,500 to 23,500 vehicle deliveries during the quarter. However, the company still delivered 5,880 vehicles in August, 48.3% more than last year’s August figure.
EV Stocks That Will Race to the Top: XPeng (XPEV)Source: Andy Feng / Shutterstock.com
It might surprise readers to realize that XPeng actually outsold Nio in August. The company recorded 7,214 vehicle deliveries to Nio’s 5,880 in the month.
The vast majority of those deliveries — 85.45% — were attributable to the company’s P7 sedan, of which totaled 6,145. The company has delivered 45,992 vehicles to date this year, representing 334% growth year-over-year.
Like Nio, XPeng also recently tapped the equity markets for financing. However, XPeng did so in the Hong Kong market rather than the U.S. market.
XPeng currently sells two vehicles: The P7 sedan and the G3s, a compact SUV. The company will soon add a third vehicle, the P5 family sedan on Sept. 15. Deliveries will begin in October.
It’s very difficult to bet against the likes of XPeng and Nio given their status as national EV brand champions in China.
On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Alex Sirois is a freelance contributor to InvestorPlace whose personal stock investing style is focused on long-term, buy-and-hold, wealth-building stock picks. Having worked in several industries from e-commerce to translation to education and utilizing his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.
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QuantumScape Partners with ‘Large Automaker’ to Evaluate Battery Prototypes — Report
California-based battery maker QuantumScape (QS) has teamed up with a large automaker to evaluate prototypes of its solid-state battery cells, according…
California-based battery maker QuantumScape (QS) has teamed up with a large automaker to evaluate prototypes of its solid-state battery cells, according to a report published by Reuters. Shares of the company climbed over 16% to close at $24.12 on Tuesday.
Backed by Volkswagen AG (VWAGY), QuantumScape develops next-generation solid-state lithium-metal batteries for electric vehicles. As per the terms of the deal, the automaker has an option to buy battery capacity worth 10-megawatt hours from QuantumScape's pre-pilot production line facility.
When asked to identify the automaker, the company said it was a “second top ten” automaker by global revenue. (See QuantumScape stock chart on TipRanks)
Two months ago, Robert W. Baird analyst Ben Kallo reiterated a Hold rating on the stock with a price target of $26 (7.8% upside potential). The analyst expects the company to report a loss of $0.20 per share in the third quarter.
Overall, the stock has a Moderate Buy consensus rating based on 1 Buy and 2 Holds. The average QuantumScape price target of $34 implies 41% upside potential. Shares of the company have lost 62.5% over the past six months.
The post QuantumScape Partners with 'Large Automaker' to Evaluate Battery Prototypes — Report appeared first on TipRanks Financial Blog.batteries
Airbus reveals the next generation of electric CityAirbus UAM solution; first flight in 2023
Airbus announced plans for a new CityAirbus at the company’s first Airbus Summit on “Pioneering Sustainable Aerospace” as the emerging Urban Air…
Airbus announced plans for a new CityAirbus at the company’s first Airbus Summit on “Pioneering Sustainable Aerospace” as the emerging Urban Air Mobility (UAM) market begins to firm up.
The fully electric vehicle is equipped with fixed wings, a V-shaped tail, and eight electrically powered propellers as part of its distributed propulsion system. It is designed to carry up to four passengers in a zero-emissions flight in multiple applications.
We are on a quest to co-create an entirely new market that sustainably integrates urban air mobility into the cities while addressing environmental and social concerns. Airbus is convinced that the real challenges are as much about urban integration, public acceptance, and automated air traffic management, as about vehicle technology and business models. We build on all of the capabilities to deliver a safe, sustainable, and fully integrated service to society.—Bruno Even, Airbus Helicopters CEO
CityAirbus is being developed to fly with a 80 km range and to reach a cruise speed of 120 km/h, making it suited for operations in major cities for a variety of missions.
Sound levels are a key factor for an urban mission; Airbus’ extensive expertise in noise-friendly designs is driving CityAirbus’ sound levels below 65 dB(A) during fly-over and below 70 dB(A) during landing.
It is optimized for hover and cruise efficiency, while not requiring moving surfaces or tilting parts during transition. The CityAirbus NextGen meets the highest certification standards (EASA SC-VTOL Enhanced Category). Designed with simplicity in mind, CityAirbus NextGen will offer best-in-class economic performance in operations and support.
Airbus is benefitting from years of dedicated research, innovation, two electric Vertical Takeoff and Landing (eVTOL) demonstrators, and development on sound technology across its portfolio of products, as well as decades of experience in certifying aircraft.
The Vahana (earlier post) and CityAirbus (earlier post) demonstrators have jointly conducted 242 flight and ground tests and have flown around 1,000 km in total. Furthermore, Airbus has used extensive subscale flight testing and wind tunnel campaigns and has leveraged its computing and modelling power. CityAirbus NextGen is in a detailed design phase right now and the prototype’s first flight is planned for 2023.
We have learned a lot from the test campaigns with our two demonstrators, CityAirbus and Vahana. The CityAirbus NextGen combines the best from both worlds with the new architecture striking the right balance between hover and forward flight. The prototype is paving the way for certification expected around 2025.—Bruno Even
Beyond the vehicle, Airbus is working with partners, cities, and city inhabitants in order to create the ecosystem that is essential to enabling this new operating environment to emerge.
Audi Q4 e-tron models ready for configuration for US buyers
Audi’s entry electric SUV Q4 e-tron lineup (earlier post) is ready for configuration by US buyers. The Q4 e-tron family—the MEB siblings to Volkswagen’s…
Audi’s entry electric SUV Q4 e-tron lineup (earlier post) is ready for configuration by US buyers. The Q4 e-tron family—the MEB siblings to Volkswagen’s ID.4 models—brings three new models to Audi’s fully-electric fleet.
2022 Audi Q4 e-tron (European model shown)
The Q4 50 e-tron and its Sportback variation offer Audi’s signature quattro four-wheel drive, powered by dual asynchronous motors, with an EPA-estimated range of 241 miles. The Q4 40 e-tron arrives equipped with rear-wheel drive, and is powered by a single asynchronous electric motor. The Q4 e-tron model line comes to market supported by an Audi ecosystem designed to make a seamless transition to electric vehicle ownership.
Powering the Q4 40 e-tron is an asynchronous electric motor producing 201 horsepower and 229 lb-ft (310 N·m) of torque. This gives the vehicle a 0-60 mph acceleration in 7.9 seconds. The Q4 50 e-tron and its Sportback variant come equipped with a dual asynchronous electric motors, which raises the horsepower to 295 and 339 lb-ft of torque (460 N·m). These higher-powered models have a 0-60 mph acceleration of 5.8 seconds.
Customers driving the Audi Q4 e-tron will be able to take advantage of a maximum 125 kW charging speed when using public DC fast charging and can charge from 5% to 80% charge in about 38 minutes. With purchase of Q4 e-tron customers receive 250 kWh at Electrify America public charging stations over the first two years of ownership. Customers access this program through the myAudi application.
Key specifications and pricing
|Maximum Torque (lb-ft)||229||339||339|
|Top track speed (mph)||99||112||112|
|Battery capacity (kWh)||82||82||82|
|EPA-estimated range (miles)||TBD||241||241|
|EPA-estimated MPGe (city/highway/combined)||TBD||100/89/81||100/89/81|
|Anticipated potential federal tax credit||Up to $7,500||Up to $7,500||Up to $7,500|
All prices provided are the Manufacturer’s Suggested Retail Price. Prices exclude $1,095 destination charge, sales taxes, title, options, and dealer charges. Dealer sets actual price.
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