Should EV Stocks Still Be Part Of Your Portfolio?
Electric vehicle stocks are still hot. Just look at Li Auto’s (LI Stock Report) IPO this week. The latest IPO reinvigorated interests in the EV space after LI stock soared more than 40% on its first day of debut.
EVs are undoubtedly the future of the automotive industry. This came after Tesla (TSLA Stock Report) became the most valuable automaker in the world. And with this new milestone, there is suddenly a renewed focus on funding EV startups. As a result, fresh money has been rushing into the likes of Nikola (NKLA Stock Report) and Fisker, just to name a few. Here’s the question though. Would the same tailwinds that started the EV revolution in the 2010s be sustainable? Would it accelerate further?
Some investors have been questioning whether there are other opportunities in the electric vehicle space. This growth runway is far from over. If the 2010s were the decade when the EV revolution got started, could the 2020s be the decade in which EVs go mainstream? Many experts believe that there is tremendous growth in the EV industry. With all that in mind, would these two EV stocks be the best stocks to buy and hold for the long term?
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Top EV Stocks To Buy Right Now [Or Avoid]: General Motors
Yes, I get it. Call me a cheater for including General Motors (GM Stock Report) on this list. General Motors may not be the pure-play EV stock that you might be expecting. But the truth is, traditional auto stocks aren’t just resting on their laurels while the EV revolution brushes through them. Instead, GM is actually pivoting its vehicle portfolio to ride on the EV adoption tailwinds.
General Motors has an impressive lineup of EVs. The company’s Chevrolet Bolt and Chevrolet Volt are among the best selling EVs in the US. Both of the models are much more affordable compared to Tesla’s models. Recently, GM has teased an all-electric version of its iconic Hummer pickup truck.
The Hummer EV will come with the second generation of Super Cruise, GM’s semi-autonomous driver assistance system. The truck is expected to go into production late next year. GM may be an old dog, but this old dog can certainly learn new tricks.
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Top EV Stocks To Buy Right Now [Or Avoid]: Nio
Nio (NIO Stock Report) has been one of the comeback stories this year. It’s interesting to note that Nio started on a low note this year, with some even questioning its ability to stay afloat. However, things are beginning to turn more hopeful when there’s an influx of funds from one of the local governments in China. And just one month ago, the company reported strong growth, and some buyers were even required to be placed on the waiting list. And that’s a first for the company.
At one point in July, NIO stock was up over 300% for the year and hit a record high of $14.98. The stock has since dropped a little, but it could have another breakout when the company releases earnings in September. But now that the EV market is getting more crowded, would this present a new hurdle for NIO stock to march higher? We can potentially expect some volatility in the near-term. On the other hand, perhaps focusing on Nio’s long term potential as a Battery as a Service (BaaS) provider could set it apart from the other EV makers.
The company has completed over 500,000 battery swaps to date. And many hail Nio as an EV company that has ‘figured out’ how to do battery swaps nicely. That could go a long way in resolving issues on charging time and range anxiety plaguing EVs.