3 Cheap EV Stocks to Buy Now: May 2024


  • Consider these potential multi baggers as EV penetration increases and the market improves.
  • Li Auto (NASDAQ:LI): Li Auto will be the first one to benefit.
  • BYD Company (OTCMKTS:BYDDF): New launches and aggressive global expansion strategy will pay off.
  • General Motors (NYSE:GM): A legacy automaker, General Motors is slowly but steadily winning the EV market.
cheap EV stocks - 3 Cheap EV Stocks to Buy Now: May 2024

Source: Smile Fight / Shuttterstock.com

The electric vehicle (EV) industry has seen a slump, causing many to feel skeptical about the industry’s path. Some believe that the future is EV, but many others think that the current government policies may not be able to bring about any change. The sector is facing several obstacles, and the deliveries haven’t been impressive.

There is an ongoing price war amongst EV makers, and despite a lower price, the deliveries haven’t picked pace. However, all isn’t lost yet. There are a few cheap EV stocks worth considering.

Some players stand apart in the crowded industry, and they have the potential to bounce back as the economy improves. The electric revolution can benefit everyone, and while the penetration of EVs is very low globally, there is potential for the industry to expand once the economy improves.

So, certain EV stocks have been standing strong amidst the turmoil, and they will become one of the best industry players in a few years. Considering the current economic environment, let’s examine three cheap EV stocks to buy.

Li Auto (LI)

Li Auto electric car in store. Li Auto Also known as Li Xiang, is a Chinese electric vehicle (EV) company
Source: Robert Way / Shutterstock.com

A Chinese EV maker, Li Auto (NASDAQ:LI) is one of the best EV makers right now. Since the company caters to the Chinese market, it is safe from the high tariffs implemented by the U.S. government. Its major market is China, and it has no plans to launch products overseas before 2025. The company impressed investors throughout 2024 with solid deliveries and strong fundamentals. 

However, due to the overall EV market slump, Li also saw a drop in sales. In April, it reported deliveries of 25,787 vehicles, up 0.4% year-over-year (YOY). In the fourth-quarter earnings report, it reported quarterly deliveries of 131,805 and revenue of $5.88 billion, up 136% YOY. The company had a cash buffer of $14.6 billion and is profitable on a net profit basis. This is where it sets itself apart from competitors.

Also, Li Auto is known for quick execution and lower-priced models. It is set to launch the Li L7 and Li L8 this month. The company is often compared to other Chinese EV makers. However, Li is profitable while several others aren’t. 

Trading for almost $26 today, LI stock has lost 23% value year-to-date (YTD) and 12% in the past 12 months. The stock started the year at $34 and soon hit $46. But it has been on a downward spree since February. 

Therefore, an improvement in the EV sector can boost Li stock, and the current dip is a chance to accumulate it. The company reports first-quarter results on May 20. 

BYD Company (BYDDF)

A close-up view of the power supply plugged into a vehicle from BYD Company (BYDDY).
Source: J. Lekavicius / Shutterstock.com

Exchanging hands for $28, BYD (OTCMKTS:BYDDF) is up 6% YTD and has been moving in the range of $21 to $28. Despite beating Tesla (NASDAQ:TSLA) in the fourth-quarter deliveries, BYDDF stock did not surge.

However, the crown has gone back to Tesla this quarter. BYD Company reported deliveries of 300,114 passenger BEVs in the quarter. Despite the market slump, the company has reported impressive delivery numbers which speak of its stronghold in the market. 

The deliveries surpassed expectations due to the growing expansion in multiple countries. It enjoys a pricing power that has helped the company achieve high popularity and higher sales. It reported a net profit of $631.08 million in the first quarter, up 10.6% while the revenue grew by 4%. 

Further, the company is making investments for international expansion while expanding the EV charging infrastructure. It is planning to choose a site for an EV plant in Mexico where it will make 150,000 cars annually.

However, the recent EV tariff announcement might have an impact on this decision. Recently, BYDDF launched the first mid-size hybrid pickup in Mexico. Also, it introduced the Sea Lion L07 in China which is set to enter Europe next year. The company is a leader in China and will continue to dominate the market. 

New launches and lower-priced models have made BYD Company one of the most popular EV makers in the world. There is no stopping its aggressive expansion plans and it could beat Tesla again in the coming quarters. The stock is a strong buy before it skyrockets to new heights. 

General Motors (GM)

General Motors (GM) sign with blue and white logo and brick building in background
Source: Jonathan Weiss / Shutterstock.com

Up 24% YTD, General Motors (NYSE:GM) is exchanging hands for $45 today, and looks highly undervalued. A legacy automaker, General Motors has several years of experience in the industry which has helped it survive the market ups and downs.

It reported stellar first-quarter results and beat expectations. The revenue came in at $43.01 billion, a 7.6% YOY jump while the net income soared 26% to hit $2.95 billion. 

In addition, the company is committed to its electrification goals and is aiming to manufacture between 200,000 to 300,000 EVs in the year. It managed to deliver 441,000 units to the Chinese market in the quarter and about 30% of the vehicles are sold in China.

It aims to launch new EVs in China later this year and continue investing in the segment. While the company might be growing at a slower pace than other big EV names in the industry, these numbers are encouraging. Despite inflation and a high-interest environment, the company has reported strong numbers which has set the momentum for the year. Also, GM stock pays dividends and has a yield of 1.07%.

One of the most resilient EV stocks in the industry, GM is a buy while it is trading below $50. Several analysts have a bullish view of the stock after the earnings. 

On the date of publication, Vandita Jadeja 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.

Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.

Article printed from InvestorPlace Media, https://investorplace.com/2024/05/3-cheap-ev-stocks-to-buy-now-may-2024/.

©2024 InvestorPlace Media, LLC