The stocks of automotive companies in general and those of electric vehicle in particular have been knocked lower in 2022. With prices and interest rates on loans at multi-year highs, and with the prospect of a recession looming on the horizon, investors have soured on electric vehicle stocks. But while the current stretch of road might be rocky for electric vehicle companies, the future remains bright for the entire sector. With the global auto industry and governments around the world fully committed to an EV transition, the market for electric vehicles will grow from $287.36 billion in 2021 to $1.32 trillion by 2028, according to market research firm Fortune Business Insights. The massive switch from gasoline to electric powered vehicles makes electric vehicle stocks a worthy, long-term holding for investors. Here are the three best electric vehicle stocks to buy now.
Best Electric Vehicle Stocks to Buy Now: Tesla (TSLA)
Still the dominant electric vehicle manufacturer in the world, Tesla (NASDAQ:TSLA) has been under pressure for most of this year.
TSLA stock has sunk 62% in 2022 and now trades at $150 a share. The selloff has intensified since Tesla CEO Elon Musk purchased social media giant Twitter at the end of October for $44 billion. About half of the decline of Tesla’s stock price has occurred since the Twitter acquisition closed on Oct. 27.
Rather than fret about the decline, though, investors should view it as a rare opportunity to buy TSLA stock while it is on sale. Despite Musk’s ongoing drama with Twitter and issues Tesla has experienced related to supply chains and China’s Covid-19 lockdowns, there are still plenty of reasons to remain bullish on Tesla and its stock.
Specifically, the company controlled 65% of the U.S. electric vehicle market in the third quarter of 2022, is aggressively expanding in Europe with a new manufacturing facility outside Berlin, Germany, and recently launched its highly anticipated Cybertruck.
Keep in mind that this is a stock that is still up 600% over the past five years. For those type of gains, most investors will put up with some drama.
Albemarle Corp. (ALB)
North Carolina-based Albemarle Corp. (NYSE:ALB) is a chemicals manufacturing company that specializes in lithium and bromine. More specifically, Albemarle is the largest provider of lithium for electric-vehicle batteries in the world.
As one might imagine, the demand for its lithium is surging. Indeed, it’s selling so much of the mineral that ALB stock is the rare security that is in the green over the past year, having risen 6.7% over that period. That compares to a 20% decline by the benchmark S&P 500 index.
ALB stock has benefitted from an explosive rally in the price of lithium. Over the past two years, lithium prices have increased 500%. Much of that gain was spurred by demand in China, which is aggressively transitioning its population of 1.4 billion people to electric vehicles.
While lithium prices have cooled off in recent months, the demand for the commodity isn’t expected to wane for many years to come. That’s good news for the long-term prospects of Albemarle and its shareholders.
ALB stock also has an attractive price-earnings ratio of 18 and pays a quarterly dividend of 39 cents per share.
Best Electric Vehicle Stocks to Buy Now: Ford Motor Co. (F)
Among traditional automakers, Ford Motor Co. (NYSE:F) is leading the way when it comes to electrifying its automotive fleet. The Detroit-based automaker is investing more than $50 billion through 2026 into developing new electric vehicles and electric versions of its most iconic brands, including the best-selling F-150 pickup truck and the Mustang muscle car.
The company has even restructured itself in order to separate its gasoline-powered automobiles from its newer electric vehicle unit.
Additionally, Ford broke ground in September 2022 on “BlueOval City,” a sprawling new campus based in Tennessee that will build all-new electric trucks and advanced batteries for future Ford and Lincoln electric vehicles.
The manufacturing site, which is being built at a cost of $5.6 billion, is slated to open in 2025. Ford calls BlueOval City the most advanced auto production complex in its 119-year history, and says it will help the automaker achieve its goal of producing two million EVs a year by the end of 2026.
F stock looks quite affordable and attractive right now. Its share price is down 44% on the year and trades at just $11.70. The shares have a rock-bottom price-earnings ratio of only 5.53, and its shareholders get a dividend that yields 4.9%.
Despite a few bumps along the way, Ford appears to be on the road to long-term success.
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.