Recent months have seen QuantumScape (NYSE:QS) struggling big-time. QS stock is down about 50% over the past six months as investors have come to question the legitimacy of the company’s solid-state battery technology and also its commercialization timeline.
We believe questions regarding the legitimacy of QuantumScape’s technology are short-sighted and misplaced. As far as concerns regarding QuantumScape’s timeline, those are very reasonable.
And as a result, we think QS stock is worth buying if time is on your side. If you can hold the stock for 5-plus years, then consider taking position.
QuantumScape has developed the world’s most impressive solid-state battery to-date.
Granted, it’s super small — way smaller than batteries powering phones these days, let alone EVs.
But the results of QuantumScape’s testing are indisputable. The company has developed a small solid-state battery prototype that shows promise. Battery performance will be dramatically improved if QuantumScape can scale their technology up.
That’s a big if.
But if anyone is going to figure out how to scale this breakthrough battery tech, it’s QuantumScape. After all, it’s the most talented, seasoned and intelligent team in the battery industry.
Time Is of the Essence
Really, the only risk here is time.
QuantumScape is aiming to produce its batteries commercially starting in 2024. But many experts in the space believe it will take them longer to deliver on this promise. We think so too.
Scientific progress takes time, and companies often overstate how quickly they can achieve progress. Just look at Tesla (NASDAQ:TSLA), for example…
However, Tesla is also a great example of how groundbreaking technology supersedes given timelines. Elon Musk and Tesla consistently overpromised and underdelivered in terms of timing well throughout the 2010s. These lofty promises resulted in TSLA stock taking a beating over the years.
But then the company had a huge breakthrough with their successful Model 3 production ramp. The stock then took off like a rocketship, scoring patient shareholders huge returns.
The same thing will happen with QuantumScape. The stock could bumble about for a few years while the company flexes its science muscles and tries to commercialize one of the century’s biggest scientific breakthroughs.
We have faith that eventually QS stock will be successful in the commercialization of their solid-state battery technology. And at that point, QS stock will skyrocket, making shareholders extremely happy.
That’s why we believe you should only look to buy QS stock if time is on your side. If you have 5-plus years to wait, you’re looking at the potential 10X to 10X gains. But if you don’t, definitely skip QS stock.
This is a long-term, buy-and-hold situation — not a stock to buy today and sell next week.
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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.