Electric vehicles are gaining momentum. Tesla gets most of the headlines but there are many other EV stocks as well. The industry has some unique investing opportunities. That’s why I’ve put together this list of six stocks to watch.
Before investing in any of these companies, it’s also important to look at larger industry trends. For example, many governments are pushing EV adoption higher. Advancing technology is also making them more affordable.
To get some insight on that end, stick around after the company highlights below…
Top EV Stocks
- Tesla (Nasdaq: TSLA)
- Nio (NYSE: NIO)
- Nikola (Nasdaq: NKLA)
- Blink Charging (Nasdaq: BLNK)
- Aricmoto (Nasdaq: FUV)
- AYRO (Nasdaq: AYRO)
Another company that I’m watching closely is Rivian. Although, it does not yet trade on public markets. To learn more about this unique business, check out this article on Rivian IPO.
This list of stocks gives you a good mix of companies. Some are pure plays and others have less direct business models. They also span multiple continents and countries. Let’s take a closer look at what makes some of these companies unique…
Electric Car Company Highlights
NIO is a Chinese EV company that’s a true Tesla competitor. It specializes in the design and development of electric vehicles. In November 2020, NIO delivered 5,291 vehicles and that’s up 109% from last year.
One important area NIO has made strides in is battery technology. This has helped it ramp up its battery-as-a-service offerings and battery-swapping initiatives. According to William Bin Li, the founder and CEO…
“As of today, Nio has deployed 143 battery swap stations across 64 cities in China, and completed over 800,000 battery swaps for our users.”
NIO is continuing to improve and expand its network and services. This should help the company remain competitive and increase sales.
Nikola has lost some luster but might not be down for the count. In September 2020, Hindenburg Research reported that they believed Nikola was committing fraud. This and some other fumbles led to GM trimming its partnership with Nikola.
Since that report, Nikola’s stock has dropped over 50% and it led to the resignation of the founder and CEO, Trevor Milton. There are definitely some flags to watch out for but this EV stock still might have the potential to push ahead.
Nikola has released an updated roadmap to production in 2023. Nikola has also recently entered into an agreement with an Arizona-based utility company and has other deals in the works.
Blink Charging is helping to support EV adoption by offering charging stations. Compared to traditional gas stations, there are few EV stations around. So this is a great opportunity as more people make the switch.
Blink Charging already has thousands of EV chargers deployed across the United States. You can find them near airports, hotels, health care facilities and many other destinations. Blink Charging offers a wide range of business models for host locations.
This company is what we consider a “picks and shovels” play. It’s not a direct EV stock but it’s helping to build a network around them. It’s similar to how businesses that provided picks and shovels during the gold rush profited. It’s indirect but can be quite lucrative.
EV Regulation and Incentives
Government regulation is an important piece of EV manufacturing and sales. Nations and states are helping push adoption and innovation higher. They’re doing this with a wide range of incentives such as tax credits.
According to the IEA, global government EV incentives climbed from $5 in 2015 to $15 billion in 2018. And it’s likely climbed higher since. Although, there’s policy uncertainty which makes it challenging for consumers and EV companies.
For example, the U.S. offers up to $7,500 in tax credits for people who buy an electric plug-in vehicle. Although, each automaker can only sell up to 200,000 units until this incentive starts to wind down. Tesla and GM have already hit those limits… but that might be increased with other EV friendly policies on the horizon.
One of the leading states with EV incentives is California. You can claim up to $9,500 to buy new or used. These policies are changing over time but continue to drive demand higher. This bodes well for EV stocks.
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