SPECIAL REPORT The Top 7 Stocks for 2024

3 Cheap EV Stocks to Buy Under $10

Advertisement

  • These are cheap EV stocks to buy and hold for 100% returns in the next 12 to 24 months.
  • Panasonic Holdings (PCRFY): Aggressive battery capacity expansion through 2031 with a focus on innovation.
  • Polestar Automotive (PSNY): Expecting acceleration in deliveries growth in 2024 and narrowing of EBITDA level loss.
  • Solid Power (SLDP): Pursuing commercialization of solid-state batteries backed by strong automotive partners.

cheap EV stocks - 3 Cheap EV Stocks to Buy Under $10

Source: shutterstock.com/Alexander Steamaze

It’s been a mixed year for electric vehicle stocks. Macroeconomic headwinds have impacted growth, and several EV companies have found it challenging to grow as competition intensifies. Amid mixed sentiments, several cheap EV stocks are still worth considering.

An important point is that there are intermediate corrections even in industries with positive tailwinds. The EV industry is still in early growth due to its penetration into different markets. For 2023, EV sales are expected to be 18% of global car sales. Further, by 2030, EV sales will likely increase to 60% of total sales. In the next five to ten years, there will be massive value creators like Tesla (NASDAQ:TSLA).

These three EV stocks under $10 are attractive. Two of these stocks represent companies in early growth stages. If business developments remain positive, these stocks can deliver multibagger returns.

Panasonic Holdings (PCRFY)

A Panasonic (PCRFY) sign hanging in Beijing, China. generation z
Source: testing/Shutterstock.com

Panasonic Holdings (OTCMKTS:PCRFY) is the top name among EV stocks under $10 to buy and hold. PCRFY stock has trended higher by 17% year-to-date. However, valuations remain attractive, considering a forward price-earnings ratio of 8. Further, the stock provides a dividend yield of 1.1%.

It’s worth noting that Panasonic is pursuing aggressive business expansion. This is a key reason to be bullish. To put things into perspective, the company is targeting EV battery capacity of 200GWh by 2031. This would imply a quadrupling of capacity compared to past financial years. Capacity expansion will translate into robust revenue and cash flow growth.

Besides aggressive expansion, Panasonic is also investing in innovation. The company claims to have developed a way to slow battery degradation. Additionally, Panasonic is targeting a 20% jump in battery density by 2030. This would imply smaller and lighter EV batteries.

Polestar Automotive (PSNY)

A Polestar (PSNY) sign at the area at Polestar powerstop in Mjölby.
Source: Jeppe Gustafsson / Shutterstock.com

Polestar Automotive (NASDAQ:PSNY) is among the most undervalued EV stocks under $10. After a correction of 54% in the last 12 months, PSNY stock seems poised for a comeback in 2024.

The first reason to be bullish on Polestar is the potential acceleration in car deliveries next year. In December, the company will commence commercial sales of Polestar 4 in China. Further, Polestar 5 is due for commercial launch next year. These two models will ensure robust delivery growth in the next 12 to 24 months.

The second reason to be positive on PSNY stock is cost cutting. Cash burn has been challenging and Polestar has initiated cost-cutting measures to reduce losses in EBITDA. This, coupled with operating leverage, is likely to translate into a healthier EBITDA margin next year. With a cash buffer of $1 billion, the company is well positioned to navigate cash burn in the next few quarters.

Solid Power (SLDP)

Smartphone with logo of American battery company Solid Power Inc. on screen in front of business website. Focus on center-left of phone display.
Source: T. Schneider / Shutterstock.com

Solid Power (NASDAQ:SLDP) is another name among cheap EV stocks to buy and hold. After a 75% correction in the last 12 months, SLDP stock trades at $1.4. Assuming a scenario where the company commercializes solid-state batteries, the stock is poised for 20x to 30x returns from current levels.

One reason to like Solid Power is that the stock is not speculative. Automotive giants that include Ford (NYSE:F) and BMW (OTCMKTS:BMWYY) back the company. BMW is conducting parallel research and development after Solid Power licensed its technology to the former.

In terms of business development, Solid Power expects to deliver A-sample EV cells to automotive partners in 2023. This is an important development, as positive news from validation testing can be a key stock upside catalyst.

Solid Power is also well positioned from a financial perspective. As of Q2 2023, the company reported cash and equivalents of $443 million. There is ample financial flexibility to invest in R&D in the next 24 months.

On the date of publication, Faisal Humayun did not hold (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.

Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modeling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector.


Article printed from InvestorPlace Media, https://investorplace.com/2023/10/3-cheap-ev-stocks-to-buy-under-10/.

©2024 InvestorPlace Media, LLC