SPECIAL REPORT The Top 7 Stocks for 2024

3 EV Stocks To Make You The Millionaire Next Door: October Edition

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  • Buy these EV stocks and hold until 2030 for millionaire-making potential.
  • Li Auto (LI): Aggressive expansion within China and launch of new models have ensured stellar deliveries growth.
  • Panasonic Holdings (PCRFY): Target to quadruple EV battery capacity by 2031 will translate into robust revenue and cash flow growth.
  • Tesla (TSLA): Supercharger network and entry into commercial EV will support growth along with significant manufacturing expansion plans.
Millionaire next door - 3 EV Stocks To Make You The Millionaire Next Door: October Edition

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The early investors in Tesla have already minted money. However, the electric vehicle sector is likely to create more millionaires in the coming years.

Given the fact that EVs are still at an early stage of adoption globally, headroom for growth is immense for some of the best EV companies. It’s time to focus on EV stocks that are worth holding until 2030 that can deliver multibagger returns.

To put things into perspective, it’s expected that EV sales will be 14 million cars in 2023. This would imply 18% of total car sales. However, by 2030, EVs are likely to represent more than 60% of total car sales. That multi-fold growth in EV sales would translate into healthy profits for the best EV car makers.

This holds true even with intensifying competition. The industry may witness consolidation in the coming years. Let’s explore the reasons to be bullish in the quest to become a millionaire from EV stocks.

Li Auto (LI)

Li Auto (Li Xiang) brand logo and electric car in store. A Chinese EV(electric vehicle) company
Source: Robert Way / Shutterstock.com

China-based Li Auto (NASDAQ:LI) has emerged as an attractive EV player in perspective of growth and value creation. Backed by positive news flow, LI stock has surged by 66% for year to date (YTD). In fact, this could be the beginning of the long-term uptrend. LI stock is among the growth EV stocks worthy of holding until 2030.

Specifically, Li Auto has remained focused on China even with high financial flexibility. The company is pursuing aggressive retail expansion with 361 stores in 131 cities. Further, the launch of multiple new models in the last 12 months has translated into stellar deliveries growth.

For Q3 2023, Li Auto reported deliveries growth of 296.3% on a year over year (YOY) basis to 105,108. With Li MEGA due for launch in December, deliveries growth is likely to remain robust in the coming year.

Notably, as of Q2 2023, Li reported cash and equivalents of $10.17 billion. During the last quarter, the company reported free cash flow of $1.33 billion. High financial flexibility would allow Li to continue investing in product development and aggressive retail expansion.

Panasonic Holdings (PCRFY)

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

For investors bullish on the EV theme, it’s important to hold quality EV battery manufacturers such as Panasonic Holdings (OTCMKTS:PCRFY). It is possibly the best name to consider at undervalued levels.

PCRFY stock has trended higher by 53% in the last 12 months. However, the stock remains attractive at a forward price-earnings ratio of 8.4. Considering Panasonic’s growth plans through 2031, expect multibagger returns.

Coming to expansion plans, Panasonic is targeting four more EV battery plants. The target is to expand battery production to 200 gigawatt-hours by 2031. If this is achieved, the company would be quadrupling its battery capacity as compared to the last financial year. This plan sets the stage for robust revenue and cash flow growth.

Besides capacity growth, Panasonic has an edge when it comes to innovation. The company is targeting a 20% increase in battery energy density by 2030. This would imply smaller and lighter batteries. PCRFY claims to have developed a way to slow battery degradation.

Tesla (TSLA)

Tesla (TSLA stock) Motors store in Piazza Gae Aulenti square in Milan, Italy
Source: Zigres / Shutterstock.com

Tesla (NASDAQ:TSLA) stock has been a massive value creator in the past. In fact, the stock can still deliver multibagger returns over a five year time horizon. Even with intensifying competition in the EV industry, TSLA stock remains hot considering the company’s innovation driven growth.

First, Tesla’s supercharger business is likely to be a $10 to $20 billion revenue contributor by 2030.  Specifically, TSLA is expanding its horizon, translating into value creation. Similarly, Tesla Semi, when launched, will mark the company’s entry into the commercial EV segment.

Notably, Tesla has an attractive lineup of models that include the Cybertruck and Tesla Roadster. This will provide a boost to deliveries growth coupled with manufacturing capacity expansion globally.

Tesla has set an ambitious target of selling 20 million EVs annually by 2030. To achieve this target, it is likely to invest in multiple new factories. In fact, India and Indonesia might be some potential locations for the upcoming Gigafactory.

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.


Article printed from InvestorPlace Media, https://investorplace.com/2023/10/3-ev-stocks-to-make-you-the-millionaire-next-door-october-edition/.

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