Tesla (NASDAQ:TSLA) is ready for its final push. TSLA stock is a double-edged sword. On one hand, you have the best EV maker in the world with promising upside in solar and energy storage. But you also have a ton of new competition entering the electric vehicle space in 2022. And the solar energy and energy storage businesses aren’t exactly booming.
The current situation is a cocktail for near-term alpha and long-term beta in the stock.
The near-term alpha is predicated on the fact that Tesla is killing it in China currently. Its Model 3 and Model Y are excelling. The latter of which was the best selling BEV in China in the second quarter according to UBS.
These strong growth trends will help Tesla report solid second- and third-quarter numbers. As a result, TSLA stock should soar back to all-time highs.
However, we think that’s Tesla’s last hurrah.
Buy TSLA Stock Today, Sell the Future Rally
New competition is coming. All the legacy auto makers — like Ford (NYSE:F), General Motors (NYSE:GM), Volkswagen (OTC:VWAPY) — are transitioning to electric.
At the same time, many new entrants are launching EVs in 2022 and 2023 such as Lucid Motors (NYSE:CCIV), Fisker (NYSE:FSR) and Canoo (NASDAQ:GOEV). Some of these companies offer EVs that are superior to Tesla’s.
China’s big players, like Nio (NYSE:NIO) and Xpeng (NYSE:XPEV), are starting with a big push in Europe but will expand and reach a global audience soon enough.
Competition is going to heat up a lot in the coming years.
While Tesla may still end up making the best EVs in the world, we think it’s silly to assume it won’t lose some market share to this wave of competition.
It’s going to happen. It’s inevitable.
And unfortunately, Tesla isn’t priced for market share erosion.
The one thing that could save TSLA in the event of market share erosion is rapid expansion of their solar and energy storage business.
But Tesla leaves us feeling unimpressed by their (lack of) progress in that space. For example, Bloomberg just reported that its solar business is actually underperforming internal expectations by a wide margin.
All in all, we think TSLA stock is due for a near-term surge but long-term struggles.
Which is exactly why I’ve been considering going all-in a new EV stock. One that is primed for early-Tesla-like growth over the months and years to come.
In fact, I have a number of EV stocks in my Innovation Investor portfolio, each of which represents the cream-of-the-crop in disruptive technological innovation. These companies all feature second-to-none management teams and massive long-term potential.
These Next-Gen Mobility stocks include a secret startup that’s spearheading the self-driving revolution, a company I consider my EV “sleeper” stock of the decade, and my No. 1 stock pick to not just rival Tesla, but to completely dominate it.
To see this lineup of innovative next-generation EV stocks, become a subscriber of Innovation Investor today.
On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.
By uncovering early investments in hypergrowth industries, Luke Lango puts you on the ground-floor of world-changing megatrends. It’s the theme of his premiere technology-focused service, Innovation Investor. To see Luke’s entire lineup of innovative cutting-edge stocks, become a subscriber of Innovation Investor today.
