- Electric vehicle (EV) stocks will likely benefit from increasing global demand.
- Blink Charging (BLNK): Revenue soars as international expansion continues.
- Li Auto (LI): Despite the recent pandemic resurgence in China, Li Auto is among the leading 10 EV names in China.
- Nio (NIO): Although the stock is at risk of delisting in the U.S., global operations are expanding.
- Tesla (TSLA): To overcome supply chain issues, Tesla is recycling and producing some materials and parts.
- Workhorse (WKHS): Management is confident Workhorse will meet production targets.
The disruptive EV industry is in part driven by environmental concerns. As required by the Paris Agreement, many countries have agreed to bring their greenhouse gas (GHG) emission levels to zero by 2050. Recent metrics form the U.S. Environmental Protection Agency suggest that transportation is the biggest source of GHG with a 27% share. InvestorPlace.com readers should know that petroleum-based fluids, like gasoline and diesel, comprise roughly 90% of the energy source in transportation.
In addition to environmental initiatives, the current war in Ukraine has put alternative energy sources and EVs in the limelight. Energy costs have been soaring in recent months. Although the situation is not as the tragic gas shortages in the 70s, today’s disturbance in Eastern Europe has put considerable stress on oil supply and prices.
According to Allied Market Research: “The global electric vehicle market was valued at $163.01 billion in 2020, and is projected to reach $823.75 billion by 2030, registering a CAGR of 18.2% from 2021 to 2030.”
Yet, despite the potential growth in the sector, the S&P Kensho Electric Vehicles Index is down by 32.7% year-to date (YTD) and 33.4% over a 12 month period. Therefore, many electric vehicle stocks offer better value now.
With that information, I have put together a list of the five best electric vehicle stocks worth your attention:
|BLNK||Blink Charging Co.||$16.69|
|LI||Li Auto Inc.||$24.39|
|WKHS||Workhorse Group Inc.||$3.02|
Best Electric Vehicle Stocks: Blink Charging (BLNK)
Blink Charging (NASDAQ:BLNK) provides charging equipment and services. In other words, although it does not manufacture EVs, it still holds an important place in the industry.
Blink Charging released first quarter (Q1) results on May 9. Revenue came in at a record high of $9.8 million with a 339% increase year-over-year (YOY). Net loss for the quarter was 36 cents per share compared to 18 cents for Q1 FY21. Cash and marketable securities totaled $161.9 million as of Mar. 31.
Management believes the company is on track to grow operations worldwide. After acquiring Electric Blue in the U.K., the company is now present in 19 countries including the U.S., U.K., Belgium, Greece and nine countries in Latin America.
Despite the growth in revenue, BLNK stock is down by 38.1% YTD and 52% over a 12-month period. Meanwhile, shares are trading at 29.2 times sales. At present, the 12-month median price forecast for BLNK stands at $25.
Li Auto (LI)
The next stock on the list, Li Auto (NASDAQ:LI), is a major player in China’s EV market. It relies on its proprietary internal combustion engine range extender to appeal to a wider customer base. Li Auto is among the top 10 EV manufacturers in China, which tops the list of GHG emissions
Domestic Chinese policies encourage drivers to choose EVs for their next car purchase. Recent research by Mordor Intelligence suggests that the national market could grow at a compound annual growth rate (CAGR) of over 30% between 2022 and 2027.
Li Auto announced unaudited Q1 results on May 10. Revenue came in at 9.31 billion RMB — or $1.47 billion — up 168.7% from 3.46 billion RMB a year ago. Meanwhile, non-GAAP diluted loss per share was 7 cents. Free cash flow (FCF) came in at $79.2 million.
In Q2, management expects to deliver between 21,000 and 24,000 vehicles. Despite the Covid-19 pandemic resurging in China, investors are looking forward to the launch the new line L9 in Q3.
LI stock is down by 17.6% YTD, but up 20% over a 12-month period. Shares are changing hands at 4.32 times sales. Meanwhile, the 12-month median price forecast for Li Auto is $33.36.
Best Electric Vehicle Stocks: Nio (NIO)
This third EV stock, Nio (NYSE:NIO), also comes from China. It differentiates itself with battery swapping and autonomous driving technologies.
Nio released Q4 FY21 unaudited results on Mar. 24. Total revenue came in at 9,900.7 million RMB — or $1,553.6 million — up 49.3% YOY. Adjusted diluted net loss was 16 cents per share. Cash and equivalents totaled $2,406 million.
Management noted that the deliveries for the ES8, ES6 and EC6 totaled 9,652 vehicles in January and 6,131 vehicles in February, up 33.6% and 9.9% YOY, respectively.
InvestorPlace.com readers will remember that the U.S. Securities Exchange Commission (SEC) has added dozens companies to a list of companies that could face expulsion from U.S. exchanges. The list comprises mostly Chinese companies, including Nio, as well as its rivals, Li Auto and XPeng (NYSE:XPEV).
As a result, NIO stock has lost almost 50% YTD. Shares are trading at 3.91 times forward sales and the 12-month median price forecast for Nio stock stands at $30.87.
Next up is Tesla (NASDAQ:TSLA), possibly the most famous EV manufacturer. This EV pioneer has disrupted the traditional automotive industry, encouraging other players to include EVs in their product lines.
Tesla reported Q1 results in early April. Revenue came in at $18,75 billion, up 81% YOY. Adjusted earnings per share was $3.22, up 246% from the year-ago period. FCF was $2.2 billion.
Despite global supply chain issues, management is keen on increasing capacity. In order to overcome some of these obstacles, Tesla is producing and recycling required parts and materials.
Along with most other EV shares, TSLA stock is down 29% YTD, but still up 16.46% over a 12-month period. Shares are trading at 61.7 times forward earnings and 14.37 times forward sales. The current 12-month median price forecast for Tesla stock is $1,125.
Best Electric Vehicle Stocks: Workhorse (WKHS)
The final EV stock on our list is Workhorse (NASDAQ:WKHS). Its products include delivery trucks and drones for the commercial transportation sector. We must remind readers that Workshorse is still a pre-revenue EV name.
Workhorse reported Q1 results on May 10. Net loss was $22.1 million. Cash and equivalents totaled $167 million. During the quarter, it opened a new design center in Wixom, Michigan to enhance engineering capabilities.
Management believes it is meeting various milestones well. It expects the production of Class 4 vehicles to start in Q3. Production of Class 5 and 6 delivery vans and trucks will likely start in Q3 2023 and more products could come in 2024.
Recent research highlights: “The global market for electric commercial vehicles is projected to reach over two million units by 2028, with a compound annual growth rate between 2020 and 2028 of around 41 percent.” In other words, Workhorse could, in fact, capture a slice of that growth.
Nonetheless, WKHS stock is down 32% YTD and 63% in the past year. Finally, the 12-month median price forecast for Workhorse is $6. The stock could appeal to potential investors whose portfolios can handle the volatility that comes with a pre-revenue EV stock.
On the date of publication, Tezcan Gecgil did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.