Automotive manufacturers are making the switch to electric vehicles, investing billions of dollars to convert their fleets to run on batteries rather than gasoline. Ford Motor Co. (NYSE:F) alone is spending more than $50 billion on its transition to electric vehicles. What’s needed now is to grow and improve the infrastructure that will support the proliferation of electric vehicles in the coming years. Battery-charging stations need to become as ubiquitous as gas stations, and battery charging times need to drop in order to make the electric revolution possible. Other issues that need to be addressed are energy storage and securing a reliable supply of the chemicals, metals and raw materials needed to build batteries. The U.S. government is supporting the transition by allocating billions of dollars to states to enable them to expand their EV infrastructures. As the auto industry goes electric, here are three EV infrastructure growth stocks poised for growth in 2023.
Albemarle Corp. (NYSE:ALB) is a chemical company that focuses on lithium, which is the key component of electric vehicle batteries. Albemarle is one of the largest providers of lithium for electric vehicle batteries in the world. That helps to explain why ALB stock has risen 43% over the past 12 months, including an 18% gain this year.
Yet the stock’s price-earnings ratio currently sits at a modest 11.06, suggesting that the shares are not overly expensive at their current levels. That’s despite the fact that the company continues to grow at an impressive rate. Its most recent earnings report showed that Albemarle’s revenue in the fourth quarter of 2022 rose 193% year-over-year to $2.6 billion. And its earnings per share came in at $8.62, up 754% from $1.01 during the same period a year earlier.
Perhaps most impressively, Albemarle forecast revenue growth of 55% to 75% in 2023 and EPS growth of 50% this year. As electric vehicles become the norm in many countries, the demand for batteries and the lithium that powers them will only grow.
Tesla (NASDAQ:TSLA) is, first and foremost, a manufacturer of electric vehicles. But Elon Musk’s company aspires to be so much more.
At its just completed Investor Day, Tesla executives didn’t unveil any new vehicle models or talk up the forthcoming Cybertruck. Instead, they spent their time talking about infrastructure and what’s required to move the entire electric-vehicle sector forward. Among the items in the latter category according to Musk, are renewable fuels, increased battery production, and energy-storage systems.
Tesla also recently agreed to open some of its U.S. chargers to outside manufacturers for the very first time. Specifically, 7,500 Tesla charging stations will become available for non-Tesla electric vehicles to use by the end of 2024, with 3,500 new and existing chargers to be made available along U.S. highways.
Opening up its charging network to competing vehicles will give Tesla access to the $7.5 billion that the federal government has allocated to help boost charging infrastructure nationwide.
After its steep selloff in the second half of 2022, TSLA stock has recovered strongly this year, rising 62% so far in 2023.
Based in Zurich, Switzerland, ABB (NYSE:ABB) is mostly known as a robotics and automation company. It makes robots for manufacturing assembly lines. However, the company also has an electric-vehicle charging unit called “ABB E-mobility” that is growing quickly. In fact, ABB can boast that it has the fastest electric-vehicle charger in the world right now. Its charger can fully recharge an electric vehicle battery in less than 15 minutes, and it can give drivers 100 kilometers of range in under five minutes.
ABB’s battery charger is way ahead of anything else currently available on the market. This explains why the U.S. Department of Transportation has partnered with ABB on the further development of its electric-vehicle charging stations.
ABB has raised $2.6 billion from capital markets to help it refine and perfect its chargers, aiming to give them stronger connectivity and reliability. The company has said that its electric-vehicle division is the fastest growing segment of its business right now.
On the date of publication, Joel Baglole 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.