3 Top Electric Vehicle Stocks To Buy According To Analysts
Electric vehicle stocks have been one of the best sectors to find growth in the stock market this year. The momentum we saw among the top electric vehicle stocks has certainly been epic, to say the least. Tesla Inc. (TSLA Stock Report), for instance, has gained almost 400% year-to-date. Recalling the red-hot rally from Tesla during its run-up to its stock splits, many were skeptical that the “bubble” would burst. While it may seem absurd to have a rally of this magnitude earlier this year, the subsequent deliveries report and the quarterly updates brought much relief to investors.
With the coronavirus pandemic continuing to rage on like a forest fire, it is understandable that investors may have doubts about cyclical industries. And EVs fall into this category. Although many chose to believe that the broader automotive industry will take a huge hit because of the pandemic, the electric vehicle industry proves otherwise. The industry surprised investors with its strong deliveries and improving operating margins despite the headwinds caused by the pandemic.
Considering the fact that we have a vaccine from Pfizer (PFE Stock Report) that appears to be working effectively, the hope for a strong recovery in the economy couldn’t be more pronounced. And this is expected to bode well for electric vehicle manufacturers when consumers have more disposable income to spend.
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Top Electric Vehicle Stocks To Buy According To Analysts: Nio Inc.
Nio Inc. (NIO Stock Report) is the best electric vehicle stock in the stock market today. The company’s stock price has gained around 1,080% this year. That number puts Tesla’s 390% gains year-to-date to shame. Granted, Nio is starting from a lower base. The company made another huge jump on Monday. This came after the company received a bullish note from JP Morgan analyst, Rebecca Wen. She raised her target price believing Nio will emerge as the ‘winner’ in the EV industry.
Wen believes Nio will be a “long-term winner” in the market for upscale electric vehicles in China. She sees Nio attaining a share of about 30% share of the segment by 2025. The analyst further stated that Nio’s “high valuation can be justified,” as the company’s revenue doesn’t just come from selling cars, but also from its vast array of services.
The Shanghai-based EV manufacturer reported on November 2 that it delivered 5,055 electric vehicles, which was up 100.1% over the amount last year. This represents significant monthly progress. The consistent strong deliveries over the past few months have certainly been very encouraging, Assuming history would serve as a good guide, with a conservative estimate, we could see an explosion in its revenue. Just to recap, Nio has achieved a positive operating margin this year.
So with the increasing deliveries, you could guess where NIO stock is heading. What’s more, the company introduced its 100kWh battery pack late last week. The company allows existing car owners to upgrade to the new battery, which can offer a range of 382 miles. With these in mind, would you be adding NIO stocks to your watchlist ahead of third-quarter earnings on November 17?
Top Electric Vehicle Stocks To Buy According To Analysts: Fisker Inc.
Next up, Fisker Inc. (FSR Stock Report) jumped more than 32% during Monday’s intraday trading. This came after a Cowen analyst, Jeffrey Osborne gave a bullish call with a price target of $22 on the electric vehicle start-up company. Osborne believes that Fisker’s go-to-market plan is much less capital intensive in comparison with Tesla. Fisker is not building its own factory. Instead, it is utilizing Magna Steyr for contract manufacturing of its vehicles. That will allow Fisker to bring the Ocean to market without the need for as much capital, potentially bringing “significant” free cash flow sooner than later.
While not every automaker goes down the contract manufacturing route, we have to give some credit to Fisker. It is, after all, making the best of the resources available to it. Even Nio which has taken off like a rocket ship doesn’t have its own factory.
Fisker expects to launch its Ocean model in the fourth quarter of 2022. It appears to me that it could be a legitimate rival to Tesla’s Model X and Y or Nio’s ES6 in terms of performance, design, and features. Yet the Ocean will be selling for just $37,500. That’s less than half of what consumers are paying for the Model X at $80,000. If Fisker can indeed sell the Ocean at this price, you would expect it to be an instant winner. Now, the car may only launch in 2022. As such, would you be willing to stake on FSR stock for this potential game-changer?
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Top Electric Vehicle Stocks To Buy According To Analysts: General Motors
General Motors (GM Stock Report) is one up and coming EV stock to watch for long term gains. Since the legendary automaker lost half of its value when the pandemic strikes, GM stock has climbed more than 130%. Although the rally in GM stock wasn’t comparable to Tesla’s or Nio’s meteoric gains, the company appears to be leading among its rivals in the traditional space.
“GM is one of the few automakers that is showing tangible progress in its transition to EVs,” wrote Morgan Stanley auto analyst Adam Jonas in a note late last month as GM announced a $2 billion investment to build electrics at a plant in Tennessee. “Non-auto investors who missed Tesla are trying to find exposure, and GM is striking the right tone.”
General Motors has an impressive lineup of EVs. Apart from its highly anticipated fully electric Hummer pickup, 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. Meanwhile, the truck is expected to go into production late next year. GM’s diversified range of options would certainly be a welcome news for customers. With the industry stalwart setting its sights on the future, will GM stocks continue to run up this year?