The market for electric vehicles and EV stocks and is going through a transition. Consumers have become frustrated by high prices, low battery range and a lack of charging infrastructure to support them. This has lead many people away from electric vehicles and towards gas-electric hybrids over the last 18 months. However, while growth in EV sales has slowed, the market is still expanding, according to industry data.
Cox Automotive reports that overall U.S. electric vehicle sales rose 11.3% year-over-year (YOY) in Q2. Electric cars and trucks accounted for 8% of all new cars sold in the U.S. during Q2, up from 7.2% the previous year. There are now more than 100 EV models available in the U.S. And, EV sales continue to expand faster than sales of gasoline-powered vehicles.
This is all to say that there are still investment opportunities to be found among electric vehicles. Here are three EV stocks that could grow your wealth.
General Motors (GM)
EV sales for General Motors (NYSE:GM) came roaring back in this year’s second quarter. The Detroit automaker reported its best quarterly sales in nearly four years, boosted by a 40% increase in sales of its EV models. GM racked up sales of 696,086 vehicles, its highest number of units sold since Q4 of 2020.
The sales were driven higher by electric vehicles, with deliveries in Q2 rising 40% YOY to 21,930 units. While EVs still comprise only 3% of total sales, the growth seen in Q2 is encouraging for the company’s long-term strategy to move away from gas-powered cars, trucks and SUVs. According to Cox Automotive, GM’s Q2 sales outpaced the global automotive industry, putting the biggest U.S. motor vehicle manufacturer back on top.
GM stock has risen 38% so far in 2024 and appears to have momentum.
Nio (NIO)
For a buy-the-dip candidate, look to Chinese electric vehicle maker Nio (NYSE:NIO). The company’s stock has taken a drubbing lately, having declined 41% so far this year. The shares now trade for less than $5, putting them in penny stock territory. While disappointing, there might be an opportunity with NIO stock. Especially as the automaker undertakes an aggressive turnaround strategy.
In recent days, Nio announced that its long-time CFO Steven Wei Feng has resigned from the company. His resignation was effective immediately. Feng is being replaced in the CFO role by Stanley Yu Qu, a company insider who has worked at Nio since 2016. His previous position at Nio was as a Senior Vice-President of Finance. Analysts claim to be encouraged by Qu’s appointment as he has experience outside Nio having started his career at Lear Corp. (NYSE:LEA) and Johnson Controls (NYSE:JCI).
Qu takes over the CFO role as Nio struggles with an electric vehicle price war in its home market. There have also been new tariffs imposed on Chinese EVs entering Europe. The turnaround will likely take time, but Nio remains a leading EV manufacturer in the world’s biggest automotive market.
Rivian Automotive (RIVN)
Speaking of EV stocks that have turned around, how about Rivian Automotive (NASDAQ:RIVN)? The EV start-up company’s stock has been on fire lately. This has been fueled by the announcement that Volkswagen (OTCMKTS:VWAGY) is investing up to $5 billion in Rivian’s operations. In the month since the VW deal was announced, RIVN stock has gained 60%, outpacing just about every other stock in the market.
Despite the increase in recent weeks, Rivian stock is still trading down 15% on the year and is 38% below its 52-week high. This means there is still an opportunity to take a position in the company’s stock as it marches upwards. Prior to news of the Volkswagen cash infusion, RIVN stock had been badly beaten down on concerns about its cash burn and growing losses. The EV maker reported a net loss of $1.45 billion in this year’s first quarter. All that seems like ancient history now thanks to VW riding to the rescue.
On the date of publication, Joel Baglole 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.
On the date of publication, the responsible editor did not have (either directly orindirectly) any positions in the securities mentioned in this article.
