Besides certain boldface names—Tesla, for instance—the universe of public EV stocks is thick with scrappy growth stocks that are only a few years or even months post-IPO. EVs depend upon lithium batteries—and Albemarle is the world’s largest lithium producer, as well as one of our picks as the best lithium stocks. The company operates the only active lithium mine in the U.S., at Silver Peak, Nevada. This price collapse signals to investors how risky the EV space can be. And yet, despite a falling market share as competition heats up, Tesla still commanded 65% of new EV sales in 2022, down from 79% in 2020. The fast-growing Manchester, N.H.-based company makes magnetic sensing and power management chips.
Please note that an experienced financial analyst selected the stocks above, but they may not be right for your portfolio. Before you purchase any of these stocks, do plenty of research to ensure they align with your financial goals and risk tolerance. All the companies increased revenue in 2022 by at least 10%. CHPT has generated solid revenue over the last twelve months, up significantly from 2021 levels.
Finding the top electric car stocks to buy should stretch beyond stocks of the automobile manufacturers like front-runner Tesla. Investors should also seek out and analyze stocks of the companies that make electronic safety equipment, connector systems, batteries, and other components of electric vehicles. The future for electric vehicles and electric car stocks looks promising. In just about a decade, one of every five cars sold is expected to be electric. By 2030, electric vehicles will comprise about half of car sales. There are many advantages to investing in electric vehicle stocks, which have gained since the 2020 presidential election.
Electric Vehicle Stock Events
The company makes a profit while most other stocks in this sector do not, netting earnings per share of $3.62 in 2022. Allocating a portion of your portfolio to EV stocks is one way to help boost the zero-emissions vehicle transition and potentially bolster your returns. Companies with two characteristics generally make the best candidates for stocks to buy and watch, according to CAN SLIM guidelines. First, they need a strong track record of earnings growth. Second, they should be technically strong and be shaping bullish chart patterns. Allegro MicroSystems has posted four straight quarters of accelerating sales growth.
Investopedia does not include all offers available in the marketplace. Neither the author nor editor held positions in the aforementioned investments at the time of publication. According to the International Energy Agency, global EV sales doubled in 2021 to a record of 6.6 million vehicles, and continued their strong growth in 2022. Forbes Advisor adheres to strict editorial integrity standards. To the best of our knowledge, all content is accurate as of the date posted, though offers contained herein may no longer be available. The opinions expressed are the author’s alone and have not been provided, approved, or otherwise endorsed by our partners.
Access to charging infrastructure is still a pain point for EV owners, so this multi-billion- dollar investment in charging should help boost the appeal of electric vehicles in the long run. Rivian had barely delivered any of its electric trucks or SUVs when it went public, so investing in the stock was the ultimate leap of faith. The company managed to produce more than 1,000 vehicles in 2021, which is a tiny number compared to Tesla and other large automakers. In 2022 it had increased that figure to more than 7,000 per quarter by the third quarter, and expects to hit a full-year target of 25,000. Despite what looks like very strong operating performance, Tesla’s stock has been in a downtrend for most of 2022.
On top of soaring deliveries, Tesla is now producing profits without relying on the sale of regulatory credits. Net income topped $5.5 billion in 2021, up from just $721 million in 2020; less than one-third of its profit came from regulatory credits. The company’s strong results have continued, in 2022, with the company highlighted record revenues, operating profit, and free cash flow in the third quarter of the year. Nikola currently sources batteries from LG Energy Solutions and in 2022 signed a deal with Proterra, another EV maker, to use Proterra’s battery packs in Nikola’s electric trucks. Also in 2022, Nikola acquired battery modules and packs manufacturer Romeo Power, securing control of critical battery pack engineering and production processes.
NIO Inc. (NYSE:NIO)
Semiconductor equipment maker Aehr offers products for testing logic, optical and memory integrated circuits, as quality and reliability needs increase. The Fremont, Calif.-based company has been growing revenue by double and triple digits. In 2022, China auto giant BYD switched to producing only all-electric vehicles and plug-in hybrid electric vehicles . The bulk of those EVs are the company’s ES8, ES6, and EC6 vehicles. Production of the company’s ET7 sedan is also ramping up, with the new vehicle now being sold into foreign markets.
The company supplies batteries, including to Tesla, and also makes its own chips. That has underpinned BYD’s rapid expansion the last couple years. The global EV leader expects to grow EV deliveries 50% annually. In 2022, vehicle sales jumped 40%, year over year, to 1.31 million while production increased 47% to 1.37 million. Li Auto — Strong Buy, based on 5 analyst ratings, 5 Buy, 0 Hold, and 0 Sell. Truist downgrades Tesla on diminished value of core business Truist downgraded Tesla to Hold from Buy with a price target of $154, down from $245.
NEW! 2023 Tech Outlook Report
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The electric car industry differs from the traditional automotive industry because it is so new. Until recently, very few companies manufactured any kind of electric vehicle, but now every major automaker in the world is developing or producing an EV. Founded in 2015, Nikola went public in June 2020 after merging with VectoIQ, a special purpose acquisition firm founded by former GM vice chairman Steve Grisky. For example, the iShares Self-Driving EV and Tech ETF has exposure to various industries, such as electric vehicles and information technology. Some of IDRV’s top holdings are Tesla, Apple , and Toyota . Information provided on Forbes Advisor is for educational purposes only.
That said, the cash crunch here continues to be an ongoing issue. Founded in 2004, Proterra designs and manufactures zero-emission electric transit vehicles and EV technology solutions for commercial applications. In 2021, Proterra became a public company through a merger with special purpose acquisition company ArcLight Clean Transition. Founded in 2014, Chinese EV maker Nio designs, jointly manufactures and sells smart and connected premium electric vehicles.
A pick-and-shovel play is a strategy to invest in companies that provide necessary equipment for an industry, rather than in the industry’s end product. Electric vehicles support both technological advancement and concerns about pollution. The company also said in February that it acquired Silicon RadarGmbH, a German producer of specialized system-on-chips for automotive applications. The company has also collaborated with Hyzon Motors to develop a fuel cell-powered vehicle that will integrate Hyliion’s electrified powertrain into a Peterbilt chassis. When you open a new, eligible Fidelity account with $50 or more. Nevertheless, GM has belatedly recognized the importance of EVs to its business, and the company delivered 39,096 EVs in 2022, up 57% year over year.
Investors need to understand that Rivian is one of the riskier ways to invest in the electric car industry. Any list of electric car stocks needs to include the granddaddy of them all, Tesla. Elon Musk’s electric car company had a banner year in 2021. Most of the vehicles were Model 3 sedans and Model Y crossover SUVs. Management has worked through inflation, supply chain, and factory ramp up issues in 2022, with production dipping sequentially in the first and second quarters of the year. However, in the third quarter of 2022, production rose dramatically, hitting an annual run rate of more than 1.4 million vehicles.
That unpredictability makes investing in the electric car industry more risky than adding portfolio exposure to the automotive industry as a whole. Like Tesla, Rivian stock has crashed since peaking in late 2021, with the company’s shares falling by roughly 80% from their highs. The company’s market cap is now about $26 billion, which is quite the drop. However, the company isn’t consistently profitable, so conservative investors will likely still view that number as wildly optimistic.
Like Tesla, Nio is another one of the biggest names in the space—but the comparison to Tesla ends there. Nio is a Chinese startup, meaning investors are open to a whole new array of geopolitical risks. TSLA’s size has not protected the stock from volatility. Shares fell 65% during 2022 as interest rates rose and the tech sector got crushed (and the company’s CEO, Elon Musk, dallied with Twitter).
Analyzing Electric Car Stocks
The growing universe of EV stocks doesn’t end with carmakers. A constellation of other companies provide car batteries, car charging stations, electric motors and other EV-related products. Among them are ChargePoint , EVgo , Blink Charging and Wallbox . The U.S. infrastructure bill that was signed into law in late 2021 ultimately dropped some EV-related proposals, but funding for EV charging made the cut. The bill provides $5 billion for states to build out a national changing network, and an additional $2.5 billion is earmarked for grants.
Investors were very excited about Rivian when the EV company went public in late 2021. Rivian’s market value briefly topped $150 billion soon after its debut. Consumer discretionary is an economic sector comprising non-essential products and services that individuals may only purchase when they have excess cash. Motor vehicle sales represent the number of domestically produced units of cars, SUVs, minivans, and light trucks that are sold. The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear.
The investing information provided on this page is for educational purposes only. NerdWallet does not offer advisory or brokerage services, nor does it recommend or advise investors to buy or sell particular stocks, securities or other investments. Lucid manufactures luxury EVs, but it delivered only 4,369 vehicles last year, blaming supply chain and production issues for its diminished performance. It’s also worth noting that Saudi Arabia’s public investment fund owns a 62% stake in the company.