Although electric vehicles have garnered intense interest lately, investors may be better served focusing on infrastructure-related battery stocks to buy rather than individual EV players.
With so many new upstarts in the electrification of transportation, it defies probabilities that all of them will enjoy significant upside success. However, every one of these companies needs lithium-ion-based powerpacks.
Further, the sharp losses among several EV manufacturers help drive the case for battery stocks to buy. Currently, the pain at the pump has many consumers eyeballing the transition to electrics. However, the free market isn’t stupid. Recognizing the increased demand, electric-powered cars have jumped in price, presenting all kinds of problems for individual players, from the smallest to the biggest.
On the other hand, the list of battery stocks to buy appear more sensible because they’re akin to selling tickets to the big game as opposed to figuring out which team will win the match-up. While you might be limiting the ultimate profitability potential with infrastructural investments, you enjoy a higher chance of gaining something positive with the right names.
|PCRFY||Panasonic Holdings Corporation||$8.26|
|SLDP||Solid Power, Inc.||$6.25|
|LAC||Lithium Americas Corp.||$20.13|
One of the biggest brands among battery stocks to buy, Panasonic Holdings Corporation (OTCMKTS:PCRFY) has been making significant waves in the EV rumor mill. In early March of this year, Reuters reported that the company was looking to purchase land in the U.S. for a mega-factory, with the purpose of building a new EV battery for Tesla (NASDAQ:TSLA).
More recently, InsideEVs.com reported in May that Panasonic was still searching for a U.S.-based site, including Oklahoma as a potential candidate. With the ability to churn out more batteries closer to Tesla’s new home in Texas, PCRFY is poised to drive higher in the market. Demand for Tesla EVs is not just increasing domestically – even right-hand-drive markets are demanding more units.
Intriguingly, PCRFY appears to be charting a series of rising lows since the early summer of 2002. Therefore, the new factory site could be the catalyst to send shares flying, making Panasonic one of the best battery stocks to buy for the long haul.
Solid Power (SLDP)
For those investors that want to swing for the fences with battery stocks to buy, Solid Power, Inc. (NASDAQ:SLDP) is a very enticing name. Specializing in all-solid-state battery cell technology — the holy grail that could kickstart a new paradigm in the global EV rollout — Solid Power presents a range of improvements over traditional lithium-ion batteries if successful.
What’s most pertinent right now regarding wider EV integration is cost. I’ve mentioned this several times before but in February of this year, the average transaction price for a new EV hit just over $60,000. That’s just not sustainable when the median household income in the U.S. is around $70,000. And with inflation eroding the purchasing power of the dollar, consumers are falling further behind.
However, Solid Power anticipates that its solid-state batteries could facilitate a 15% to 35% cost advantage over existing lithium-ion battery packs. Combined with other attributes such as higher energy and superior safety profile, SLDP is intriguing.
Still, as a former special purpose acquisition company (SPAC) with an aspirational target, strict money management would be appropriate.
Lithium Americas (LAC)
Although not a direct play among battery stocks to buy, Lithium Americas Corp. (NYSE:LAC) is nevertheless crucial to the manufacturing of powerpacks and therefore, to the global EV rollout. A lithium-mining firm, Lithium Americas is focused on advancing the Cauchari-Olaroz and Pastos Grandes projects in Argentina and the Thacker Pass project in Nevada.
While EVs have been extraordinarily relevant for years, the military conflict in eastern Europe delivered a brighter spotlight to battery stocks to buy. Essentially, LAC is attractive primarily because of its exposure to generally stable jurisdictions. With China ranking among the top lithium producers in the world, it’s vital that the U.S. and its allies secure supplies of the potential “fuel” for the transportation networks of tomorrow.
Otherwise, we could be suffering a Russia 2.0 scenario all over again.
Now, it’s important to realize that lithium mining isn’t a panacea to geopolitical dependencies, particularly since the process consumes significant volumes of water. Still, as part of a diversified energy network, LAC could make a lot of sense.
On the date of publication, Josh Enomoto 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.