Battery stocks are an obvious growth sector with tremendous potential. The automotive industry is quickly pivoting toward EVs in a seismic shift that is here to stay. Tesla’s (NASDAQ:TSLA) pioneering efforts have made it one of the most valuable firms in existence. Its success has paved the way for a shift that has seen EV upstarts follow suit and legacy automotive firms develop their own EVs. This has led to the rise of high potential battery stocks
In turn, that shift has opened up a massive opportunity for EV battery suppliers whose components are integral to the industry. There are several firms emerging that are in a position to become dominant for various reasons and are screaming buys.
Panasonic (PCRFY)
Panasonic (OTCMKTS:PCRFY) stock is an important one in the EV battery space. It is a major supplier to Tesla. Many investors are well aware of the relationship between the two firms. However, Panasonic is also making inroads with other legacy automakers including BMW and Toyota. In time, those relationships could blossom and become as important as its current relationship with Tesla.
Panasonic jointly operates a battery factory with Tesla. The two firms intend to expand production at that plant through 2026. Meanwhile, Panasonic also plans to build two additional battery plants in order to produce battery cells for Tesla.
Tesla has proven to be incredibly resilient in 2023 and has reacted adeptly to a changing landscape that has included expiring EV subsidies. The company has offered discounts in an attempt to combat Chinese firms market share dominance. It seems to be working and it all points to the idea that Panasonic would do well to focus on expanding its relationship with Tesla as a first priority.
Lithium Americas (LAC)
Lithium Americas (NYSE:LAC) promises to potentially become one of the most important links in the U.S. supply chain. That makes the stock a buy as its story is still very early in the making.
The company holds rights to mines in Argentina and the U.S. The U.S. mines at Thacker Pass are home to the largest lithium reserves in the U.S. That truth has caused management to make a bold decision regarding the firm’s future. That decision is an opportunity for investors.
The company realizes that Thacker Pass is more valuable as a separate entity given its strategic importance to the U.S. EV industry. It separated the mining operations into two distinct publicly-traded firms to capitalize on that opportunity. That separation is likely to occur in October and when it does happen it should unlock shareholder value.
Thacker Pass is expected to have a 46-year lifespan and produce enough lithium to power 25% of EVs globally. Investing now is one of the clearest opportunities available to EV enthusiasts and those who recognize the firm’s geopolitical importance.
Freyr Battery (FREY)
Freyr Battery (NYSE:FREY) stock was already interesting due to the dual development of projects in the U.S. and Europe. The company is early in its development but there’s a lot of excitement building as its gigafactories on both sides of the pond offer substantial potential.
That potential clearly has the European Union excited as it recently awarded Freyr Battery a €100 million grant to promote localized production of EV batteries. That should go a long way in helping Freyr Battery develop its Giga Arctic plant in Norway.
The company has an overarching goal of reducing carbon emissions through the production of its battery solutions. Influential forces in the stock market have recently got on board with Freyr’s mission. Morgan Stanley analysts weeks ago stated that the company’s shares have the potential to appreciate by more than 70%. The new funding should allow the company to pursue growth at an accelerated pace.
On the date of publication, Alex Sirois 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.
