EV stocks have risen in value as electric vehicles gain traction — but not all are created equal. Certain automakers are more prepared than others for an electric future. As consumer preferences and government incentives continue to shift in favor of electric vehicles, EV stocks have outperformed the market and appear to many investors to be a sure bet.
With well-known brands like Elon Musk's Tesla capitalising on social media fame, many investors are compelled to invest in electric vehicles. However, doing so strategically is critical. Discover how to identify lucrative investment opportunities in electric vehicle stocks and the industry that supports them.
One of the most effective strategies for identifying high-quality EV stocks is to determine which are currently undervalued. When evaluating undervalued stocks, it is critical to consider their history and potential, as well as their relative performance to the broader market.
Several pressures are currently affecting the electric vehicle industry, affecting short-term stock prices — but not long-term value — such as chip shortages. Identifying large industry players whose stock has fallen below the industry average is an excellent way to accumulate solid stocks that will perform over time.
Nio's line of vehicles, charging stations, and other products dominates Chinese electric vehicle innovation. Its vehicles are self-driving, demonstrating a vision for the future.
Nio's quarterly sales growth is impressive, averaging 9.8 percent between the second and third quarters of 2021 and 102.4 percent year over year.
However, supply chain constraints are currently weighing on Nio's stock prices. The resolution of these issues may result in an undervaluation, which astute investors will seize upon.
Nio's plan to build advanced electric vehicle service stations that will revolutionise how EV drivers travel long distances instils investor confidence in the company's future. Nio intends to launch three new products based on its technology platform in 2022.
XPeng, another of China's colossal electric vehicle powerhouses, stands in opposition to Nio. XPeng surpassed Nio in the numbers game in the third quarter of 2021, with a 199.2 percent year-over-year increase in vehicle deliveries.
XPeng's sales are lower in comparison, but with consistency in the face of shortages, XPeng's year-end projections are solid.
Investors are encouraged by XPeng's technological forays, with its proprietary software XPILOT promising advancements in its electric vehicle fleet.
Fisker uses a slightly different manufacturing process than some of its competitors, which leaves investors curious about the company's long-term viability. The company plans to launch select models of its Ocean SUV, which is manufactured by Magna International, in 2022, and is currently raising funds to begin production on a second vehicle, according to the Los Angeles Times. Fisker's Personal Electric Automotive Revolution, or Project PEAR, is scheduled to begin production in late 2023 or early 2024.
Tesla is the EV stock market's elephant in the room. If you leave it, you risk leaving significant money on the trading room floor. Apart from FOMO and media attention, Tesla appears to be on a clear path forward for the time being, given its recent increases in price targets. The stock has gained nearly 30% in the last year. It’s always wise to invest in the top player.
If first-mover advantage counts for anything, ChargePoint wins — as of April 2021, it controlled 73% of the North American charging port market, and its third-quarter revenue increased by 79% year over year in fiscal year 2022.
As ChargePoint expands into Europe with a three-year goal of reaching $1 billion in revenue, investors are confident in the company's ability to deliver on these promises.
Investments far too frequently feel utilitarian, constrained by market demands and the imperative to profit. It's fairly uncommon to make an investment that tends toward excellent returns and instils a sense of optimism for the future.
However, investing in electric vehicle companies enables you to do both. Not only do you have excellent prospects, but you can also be confident in the investment's environmental sustainability and the potential for job creation for workers worldwide.