There’s a good deal of hype with electric vehicle and SPACs these days. After a couple of high profile electric vehicle companies went public with a SPAC, keep an eye on related stocks like Hyliion Holdings (NYSE:HYLN).
Granted, the stock plunged from double top resistance at $54.45 to a low of $18.09. However, despite the sharp decline, don’t write off the electric vehicle stock just yet. HYLN now appears technically oversold. Not only did HYLN find double bottom support at $18.21, it’s aggressively oversold on relative strength (RSI) and MACD.
Plus, with investors seeing these stocks as another way to trade a Tesla-like (NASDAQ:TSLA) boom, HYLN could see higher highs on EV excitement. According to Elon Musk, the global industry could see 30 million EVs on the road by the end of the decade, as noted by Barron’s contributors Nicholas Jasinksi and Al Root.
Hyliion Could Help Revolutionize the Electric Truck Industry
Tractor-trailer rigs are an essential part of the U.S. economy. They’re hauling food, clothes, vehicles, just about everything we need across the nation. They also cause a good deal of pollution.
“Big trucks are legally allowed to emit as much pollution as several dozen of today’s cars. But many big trucks actually emit as much pollution as 150 cars,” as reported by Clean Air Trust, which also adds that such trucks could be more than 90% cleaner than they are today.
That brings Hyliion Holding into the picture, which is marketing a hybrid-power system for Class 8 trucks, which it says can travel up to 1,300 miles. It also notes it can charge its batteries en-route and can be refueled in about 10 minutes. Plus, it says the trucks can deliver net-negative carbon emissions with renewable natural gas.
Granted, as noted by InvestorPlace contributor Larry Sullivan, “There are critics who doubt Hyliion’s assertions and have blasted the company. This criticism comes after doubts circulated about other EV companies, causing downward pressure on their stocks.”
However, don’t write off the stock just yet after the pullback.
With big global demand for EVs and a greener future, stocks like HYLN could offer long-term opportunity.
There’s a Global Push for EVs All Over the World
Here in the U.S., for example, California Gov. Gavin Newsom signed an executive order that will ban the sale of gas-powered cars starting in 2035. In addition, we have to consider that under a Biden presidency, we could see far more EVs on the road.
In fact, according to Goldman Sachs analyst Mark Delaney, Biden could boost further electric vehicle adoption. As reported by Bloomberg Law, “Joe Biden’s $2 trillion climate plan, which calls for more public investment in charging infrastructure and fresh tax credits, would boost electric-vehicle adoption.”
Plus, we have to consider European lawmakers have ordered automakers to sell more electric vehicles. “Automakers need to sell more electric vehicles after EU lawmakers in December 2018 ordered them to cut CO2 emissions by 40 percent between 2007 and 2021, and then by a further of 38 percent by 2030, or face fines,” as reported by Barron’s.
In short, it’s time to invest in accelerating EV stocks.
The Bottom Line on Hyliion Stock
While I’m not recommending that you “back up the truck” on HYLN and risk the house, it may be worth a small bet here. With a greener future ahead and plenty of global demand for electric vehicles, the boom may have only just begun. Plus, with HYLN oversold, we could see the stock come roaring back with other EV stocks.
On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.