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9 Best Electric Vehicle (EV) Stocks to Buy in 2021
Electric vehicles, also known as EVs, have become all the rage lately, especially among investors.
As the world looks to go green, and electric vehicles address one of the largest drivers of carbon emissions, investors have been flocking to electric vehicle stocks, leading to increased trading volume, and in many cases, extreme price appreciation.
Moreover, many believe the tremendous gains seen in the sector are just the tip of the iceberg.
Best Electric Vehicle (EV) Stocks to Buy in 2021
As is the case with any stock or other investment vehicle, not all electric car stocks are created equal. It’s important that you don’t invest in a stock based solely on the fact that it’s in the electric vehicle sector.
Returns on investments in this or any sector will be wildly different from one stock to another. While the electric vehicle industry is relatively new, there are a ton of companies getting into the fray, making pinning down a list of strong opportunities in the space more difficult than in mature industries with clear market leaders.
Here are the top electric vehicle stocks on the market today:
1. Tesla Inc (NASDAQ: TSLA)
Headquartered in Palo Alto, California, Tesla has become synonymous with the electric vehicles industry. The company, led by billionaire entrepreneur Elon Musk, continues to be a pioneer in the electric vehicle space.
So, it’s no surprise investors have been all over the stock, which has sent share prices soaring over the last year, even in the face of the COVID-19 pandemic. In fact, Tesla’s share price climbed from about $171 per share in February 2020 to a high of over $900 per share in early 2021 before pulling back somewhat.
Although it’s too late to take advantage of those gains, many experts believe plenty more upward movement is ahead for this high-growth stock.
Following the company’s fourth-quarter earnings report, Musk pointed to growing vehicle deliveries and guided for 50% year-over-year growth in the metric through 2021. At the same time, the company has several catalysts ahead to look forward to:
- New Models. First and foremost, investors are waiting for Tesla to unveil the newest versions of its Model S and Model X electric cars. These are the company’s flagship vehicles, and the new models of these vehicles are expected to be met with high levels of demand.
- Cybertruck. For some time now, investors have been awaiting the launch of the Tesla Cybertruck, an electric truck with a sleek new look. Being one of the first electric trucks to hit the market, it is expected that the Cybertruck will also generate incredibly high demand.
- Electric Van. With electric cars and trucks on Tesla’s assembly line, there’s only one vehicle missing: electric vans. Although there is no timeline for when Tesla will release them, Musk said the company was working on an electric van offering on the conference call following its fourth-quarter earnings report.
There’s no questioning that Tesla stock is currently expensive, both in raw dollars and in terms of its price-to-earnings growth. However, the high valuation is largely justified by the incredible growth the company has seen in revenue and earnings, and that’s expected to continue in the future.
All in all, it’s rarely a good idea to bet against the pioneers of any industry, and it’s not likely to prove to be a good idea to bet against Tesla stock.
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2. Nio Inc (NYSE: NIO)
Nio has become a hot topic in the stock market as one of the leading competitors to Tesla. The company is a Chinese electric car startup with plenty of offerings on the market that are starting to gain steam.
Ultimately, Nio is a double emerging market play. Not only is the company taking part in the emerging electric vehicles industry, but it’s also located in China, an emerging economy that’s quickly becoming a developed one, which is a recipe for tremendous growth.
In the beginning, investors were concerned about Nio. As recently as 2019, sales had slumped, and many believed the company was headed toward bankruptcy. However, last year, that all changed as sales made a tremendous comeback, and the growth in sales is expected to continue through 2021.
In January 2021, sales increased by more than 350%, which propped up the value of the stock. At the same time, the company further excited investors by unveiling the Nio ET7, a stylish, fully electric sedan.
Investors are looking to the ET7 as a potential blockbuster. At the same time, demand for electric vehicles in China continues to climb as consumers who were locked down during the COVID-19 pandemic are venturing out.
Nio also seems to be expecting demand for its electric vehicles to ramp up significantly, which can be seen in the company’s production capacity. Recently, the company has been spending massive amounts of money on infrastructure with the goal of increasing its production capacity, which sits at about 150,000 vehicles for 2021.
Although the company isn’t yet profitable, it is quickly working its way to that point. In the most recent quarter, analysts expected the company to generate losses of $0.44 per share, but losses came in sharply lower at $0.12 per share, and with the increased demand and production capacity, many argue that profits are on the horizon.
As demand continues to increase, Nio continues to innovate, and a global focus on clean energy becomes stronger, the stock is becoming more and more of an opportunity. Combine that with the fact that the company is fast approaching profitability in a double emerging market, and the stock becomes hard to ignore.
3. General Motors (NYSE: GM)
You might not expect to see a 112-year-old traditional automaker included in the list of the best electric vehicle stocks for 2021. But why would a massive vehicle manufacturer and leader in the auto industry exclude itself from the EV market?
They wouldn’t!
Not only is General Motors working to develop electric vehicles, but the company has also made what investors see as one of the biggest promises in the auto industry’s history.
General Motors is working its way toward an all-electric future and has announced its ambition to end production of its fossil-fuel powered vehicles in favor of all electric vehicle models.
To kick things off, the company plans to invest $7 billion this year and have 30 electric vehicle models in production. By 2025, the company will have invested $27 billion into the EV space.
As a result of the company’s aggressive plans to become a leader in the electric vehicle market, it’s earned its spot on the top EV stocks for 2021.
Although General Motors’ stock took a hit as a result of the coronavirus pandemic, the company quickly recovered, climbing from lows of $16.80 per share to February 2021 highs of $56.88. The growth in the stock price has been nothing less than jaw-dropping, and there’s strong potential for this extreme growth to continue.
In fact, the company has three new products hitting the market by fall, including the first-ever electric Hummer, known as the Hummer EV. The company will be also launching the 2022 Chevy Bolt EUV, a slightly larger version of the Chevy Bolt.
The third vehicle might be the most exciting. General Motors entered into an agreement to supply FedEx with delivery vans known as BrightDrop EV600. These vans offer 600 cubic feet of space for shipments, are 100% electric, and have a 250-mile range.
Not to mention, with its fast charger, the BrightDrop EV600 is able to absorb 170 miles of range power per charging hour.
Over the years, General Motors has proven to be a dominant player in the auto industry, and as it continues to innovate in the emerging electric vehicle market, it will likely continue to hold its crown. All in all, the stock is one that’s worth your attention.
4. Ford (NYSE: F)
Ford is another pioneer in the automotive industry, with a leadership position that’s held for more than a century. Ford has survived the peaks and valleys of the auto market and has remained a leader in innovation. It’s not a company that’s likely to leave an opportunity on the table.
As a result, the company is also racing to lead the charge in electric vehicles.
Currently, Ford has two electric vehicles on the market:
- Mustang Mach E. The king of the muscle car, Ford wouldn’t be doing its followers any favors if a switch to the electric vehicle model left the Mustang in the dust. So, it’s no surprise that the first all-electric vehicle out of the company is known as the Mustang Mach E. Showcasing the power electric cars can have, the Mustang Mach E reaches peak acceleration in under one second and comes with minimal scheduled maintenance, reducing the cost of ownership.
- 2022 E-Transit. Ford is also looking to produce commercial vehicles in competition with its long-lasting rival, General Motors. The 2022 E-Transit seems to be a shot at doing just that. The commercial van features plenty of space for transporting packages or any other commercial use. Unfortunately, range comes up short compared to the BrightDrop EV600 with just 126 miles of range on a full charge.
These are just the first of many 100% electric vehicles Ford is likely to offer in the relatively near future.
Not to mention, the company recently announced a partnership with Google. The two companies will work together to modernize Ford production facilities through vision AI, create new buying experiences, and create new offerings with connected vehicle data.
Because the auto industry of the future blends technology with traditional mechanics, a partner like Google is a major advantage to any player in the game at the moment.
Like with General Motors, an investment in Ford is an investment in a longstanding company that has not only survived the ups and downs of its industry and the economy, but thrived in the process. Now, with Google on its side, this classic winner is becoming even more attractive, making it one for the watchlist.
5. Apple (NASDAQ: AAPL)
When you think of the automotive industry, Apple isn’t likely the first to come to mind. The company became a behemoth thanks to products like the iPhone and iPad; what does it have to do with electric vehicles?
Everything!
Apple is planning on launching an autonomous electric vehicle of its own. The project has hit a few roadblocks recently. The company is still looking for a potential manufacturing partner to help it build its electric autonomous vehicles. It also announced the original project manager for its EV lineup left the program to join a new startup.
Nonetheless, if Apple’s history is any indication, it will quickly make its way past these roadblocks and put the incredibly innovative minds on its payroll to work to produce one of the best electric vehicles on the market.
Sure, that may be a long way off, but it’s coming, which means an investment in Apple gives you exposure to the electric vehicles market.
Because there’s always risk with investing in an emerging industry like electric vehicles, it’s wise to consider investing in stocks that give you access to the emerging market while providing stability through a tried-and-true business model.
That’s exactly what Apple does.
The company has a strong history of increasing revenue and earnings, making it one of the strongest growth stocks on the market today. Moreover, throughout the last year, it has shown it’s capable of performing well even in times of a pandemic.
As a leader in innovation, Apple climbed above and has stayed on top of the competition in the smartphone and tablet industries, and will likely take a sizable piece of the electric vehicle market in time, making the stock one for the books.
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6. Blink Charging (NASDAQ: BLNK)
While the majority of companies in the electric vehicle market are focused on developing and manufacturing the next big car, truck, SUV, or van, there are only a handful of companies focused on the technology needed to charge these vehicles.
One of the exciting facts about Blink Charging is that the company has so little competition.
Electric vehicles need power to run. There’s no gasoline and no combustion; these cars run on batteries. The batteries that provide the power for electric vehicles run out of juice and need to be recharged, generally after every couple hundred miles.
At first glance, it may not seem like a great business. Electric vehicles come with chargers that let you plug them in and recharge them at home. So, what’s the need for a charging company?
Wouldn’t it be nice to pull your car into a parking space and plug it in, knowing your car is charging while you’re shopping or watching a movie? What about when you go on vacation? Wouldn’t you want to charge your car while you’re away from home?
That’s where Blink Charging comes in.
The company owns a network of charging stations, some of which it manages directly, and some of which it sets up and allows a business owner to manage while taking a share of the revenue. They work like gas stations, with customers paying to plug their electric vehicles into one of the chargers.
With the goal of continuously expanding its charging station network, Blink Charging could become the preferred charging station for electric vehicles, just as if it was the Exxon Mobil of the future.
As the company’s network of charging stations grows, so too does its revenue, which increased more than 80% last year.
Although the company is still operating at a loss, the vast majority of its spending is being used for expanding infrastructure that will lead to future revenue, much like what we saw from Amazon.com in the early days of e-commerce.
The bottom line is if every other company on this list does well, electric vehicles will be all over the place, and few companies are focused on charging stations. With relatively little competition, a network that’s growing quickly, and profitability likely just around the corner, Blink Charging is worth your attention.
7. Nikola (NASDAQ: NKLA)
Nikola is another green vehicle startup, but it comes with a twist. The company isn’t interested in creating the next sporty electric car or creating an electric vehicle the whole family can enjoy.
Instead, Nikola is focused on the utility of the development of hydrogen fuel vehicles, specifically, electric trucks. Hydrogen fuel is a clean source of energy that gives off one byproduct when consumed: water.
Sure, strictly speaking, we’re not talking about electric vehicles here, but the electric vehicle discussion isn’t complete without speaking to the alternative clean transportation offerings at Nikola.
The company currently has three trucks on the market, only one of which is a consumer vehicle: the Nikola Badger. The wide-body pickup truck was designed to provide all the capabilities consumers look for in pickup trucks without the high emissions associated with these gas-guzzling vehicles since Nikola trucks run on hydrogen fuel.
Although the consumer pickup truck is an exciting offering, it takes the back seat to the other two offerings the company brings to the table, the Nikola Two and Nikola Tre. Both of these trucks also run on hydrogen fuel, but that’s not the exciting part.
Both the Nikola Two and Nikola Tre are semitrucks. That’s right, the big 18-wheelers that have become an integral part of the U.S. and global economy are being run on hydrogen rather than diesel fuel.
The lower-cost Nikola Tre is capable of running 250 to 300 miles on a single charge, with the Nikola Two’s range being 500 to 750 miles. Moreover, it only takes about 20 minutes to fill these vehicles up from empty.
As a startup, Nikola is another company that isn’t quite profitable yet, but it’s quickly ramping up production. Given the current leadership in Washington D.C., Nikola will likely benefit from increased demand as companies that rely heavily on trucking look to go green in order to take part in tax and other incentives.
All told, Nikola is working in a space with little competition and solving a major problem in the process. As a result, the potential for dramatic growth in the stock is compelling.
8. Workhorse Group (NASDAQ: WKHS)
Workhorse Group is another clean transportation company with a twist.
As the company’s name suggests, its electric vehicles are designed to be workhorses. The company’s claim to fame is its line of electric delivery vans, and it’s gaining in popularity.
In fact, the company’s customers already include UPS, DHL, and Fed-Ex — not to mention, the company is partnered with massive international companies like Duke Energy, Hitache, and Ryder.
As a company that caters to the shipping industry, Workhorse Group is another company that’s likely to benefit greatly from the current leadership in Washington. The Biden administration and the Democrats in control of Congress are expected to push for legislation that will lead to further adoption of electric vehicles among corporations, lifting demand for Workhorse vehicles.
The company’s most popular offerings are its two C Series trucks — one with 650 cubic feet of cargo space and the other with 1,000 cubic feet. Both vehicles also have a range of 100 miles, making them a perfect option for last mile deliveries, a massive segment of the package and delivery business.
Some argue investors already have driven the valuation of Workhorse Group stock too high, but others point to the fact that the company’s focus on last-mile delivery vehicles reduces competition and may give it the ability to control the market, offering a growth prospect that makes the high valuation more reasonable.
While Workhorse Group is one of the higher-risk stocks on this list, it’s a compelling offering. Should it become a leader in the provision of last-mile delivery electric vehicles, this relatively small startup could grow to become a massive blue-chip player in the auto industry.
9. XPeng Inc (NASDAQ: XPEV)
XPeng is another electric vehicle startup making waves in the Chinese market. The company’s most impressive offering is its G3, a super-long-range SUV capable of traveling 323 miles on a single charge.
The company also offers the P7 super-long-range sedan, which can travel 438 miles on a single charge and offers an intelligent infotainment system and user experience.
Both vehicles are equipped with hands-free parking capabilities and artificial intelligence-assisted driving, bringing more safety and simplicity to the electric vehicle space.
XPeng is seeing compelling growth in revenue. Sales were up 470% on a year-over-year basis in January 2021, following 326% year-over-year growth in December, and there’s no end to the trend in sight.
XPeng is already incorporating AI features into its cars, but it plans on going fully autonomous. The company recently announced a partnership with Livox, a leading Chinese lidar company. (Lidar — short for light detection and ranging — is a technology that uses lasers to sense the surroundings and makes autonomous driving possible.)
XPeng is expected to deploy lidar sensor technology in products as soon as this year, meaning a fully autonomous electric vehicle may be coming out of XPeng relatively soon.
The company is also quickly going from national to international. In fact, XPeng recently made its first shipment of XPeng G3 smart cars to Norway. The company is also expected to roll out its P7 model in Europe later this year, further expanding its target market and potential growth.
The domestic Chinese electric vehicle market is growing at an incredible rate too, and XPeng smart electric vehicles offer consumers the environmental efficiency they want alongside smart technology that enhances the driving experience.
Moreover, with the company’s plans to include lidar systems in production this year, it is on track to become the first automaker to mass produce an electric vehicle equipped with lidar, further solidifying its position as the leader in smart technology being incorporated into electric vehicles.
With strong growth taking place in revenue and an expansion into international markets to drive further growth, XPeng is a stock that’s well worth paying attention to.
Final Word
The electric vehicles industry is an exciting one that’s garnering quite a bit of attention from the investing community. With the global view of energy changing quickly, demand for electric vehicles is likely to continue on an upward trend.
Moreover, electric vehicles are the result of a new intersection between traditional mechanics and cutting-edge technology, making them a very interesting topic.
Although investing in electric vehicles comes with risk, there’s no such thing as a risk-free investment, which is why research is so important when investing in any stock. At the moment, everything seems to be falling in line for the electric vehicles industry, setting the stage for a continuation of the dramatic growth we’ve seen among leaders in the space over the last year.
So, there’s plenty of opportunity in the industry.
When investing in the space, keep the risks in mind and do your research. By making well-researched, well-thought-out investment decisions, you stand to enjoy benchmark-beating profitability.
Published at Wed, 07 Apr 2021 13:09:57 +0000
