Demand and prices throughout the electric vehicle sector remain muted. While that is generally negative, it also creates opportunities. Currently there are many high quality EV stocks with potential that are trading at a discount.
It is in hyperbole to suggest that some of them are trading at once in a lifetime valuations. The sector is very clearly filled with unprecedented potential. The contrarian spirit and a bit of capital can go a long way in the current market.
What’s more, the company’s discussed below are fundamentally strong overall. Investors who buy their stocks aren’t taking a wild shot in the dark. Instead, they’re putting their money into fundamentally sound firms that happen to be facing cyclical adversity.
EVgo (EVGO)
EVgo (NASDAQ:EVGO) has emerged as one of the best EV stocks with potential in the EV infrastructure sector. The company is rapidly improving overall. Meanwhile, leaders in the sector continue to head in the wrong direction. Thus, the company has put itself in position to further increase its market share in the nascent sector.
Investors who look through EVgo’s most recent presentation slides will be impressed. Its DC fast charging stations are present at more than 950 locations overall. Evgo offers more than 3,400 DC fast charging stalls at those locations. Furthermore, the company has 10 OEM partners with which it engages to build out all aspects of EV infrastructure.
Company-wide growth is perhaps the most impressive metric behind EVgo. Revenues more than tripled during the 3rd quarter. Meanwhile, net losses improved by 45%. The company is beginning to pose a real threat to better established EV infrastructure firms. Investors should understand that EVgo is making serious strides while also offering an inexpensive investment at the moment.
Albemarle (ALB)
Albemarle’s (NYSE:ALB) Arguably the closest thing that there is to a slam dunk stock at the moment. share prices were battered throughout the second half of 2023 as serious headwinds emerged in the electric vehicle industry. That resulted in a serious decline in demand for the lithium, used in EV batteries, that Albemarle produces.
Consequently, the per ton price of lithium collapsed sending the ripples throughout the industry. Today, the general consensus is that lithium prices will rebound at some point in 2024 or 2025. Some sources suggest that an upward trend will begin In the first half of this year.
Albemarle isn’t doing poorly from a fundamental perspective. During the third quarter, sales increased by 10% despite the price collapse. Albemarle is also backed by the U.S. Department of Defense because of its presence acquiring the critically important mineral lithium.
The problem continues to be that albemarle’s valuation is very low. Investors are currently paying less per dollar of its earnings than they have at almost any point during the last decade. A glass half full perspective means that is an excellent opportunity.
Lithium Americas (LAC)
Lithium Americas (NYSE:LAC) Is another lithium stock that has obvious and unprecedented surge potential. The company is developing the Thacker Pass lithium deposit in Nevada. It is the largest such deposit in the Western Hemisphere and thus possesses incredible strategic value.
But just how big is that surge potential? The answer is more than 300% above its current share price. Lithium Americas continues to work to rapidly develop the site. It is building temporary housing at the Nevada location to shelter workers who are certain to be very busy. In October, the company separated its operations in order to isolate the Nevada location. That’s a strong signal of just how much the company believes in the value of those operations.
It is expected that the project will not begin producing lithium until mid-2026. Again, it is the largest lithium deposit in the Americas. It is expected that it will produce substantial amounts of the critical mineral thus reducing dependence on China, perhaps entirely.
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.
