6 EV Stocks To Watch: What You Need To Know Before Investing

Lafayette - Circa September 2017: Tesla Supercharger Station.
Jonathan Weiss / Shutterstock.com

As consumer preference and government incentives continue to shift toward electric vehicles, EV stocks have performed well in the market and seem like a sure bet to many investors.

With recognizable names like Elon Musk’s Tesla capitalizing on social media fame, getting involved in EV is inevitable for many investors. But doing so strategically is key. Learn how to spot lucrative investment opportunities in EV stocks and the electric car support industry.

How To Identify the Best EV Stocks To Buy Now

One of the best ways to identify good EV stocks is to determine which ones are currently undervalued. When analyzing undervalued stocks, it is important to consider their history and potential along with how they are trending compared to the general market.

Currently, the electric vehicle industry is facing several pressures that are affecting EV companies’ short-term stock prices — but not their long-term value — including things like chip shortages. Spotting big-time industry players whose stock drops below average is an excellent way to acquire solid stocks that will produce over time.

Chinese Electric Vehicle Stocks

Building Wealth

Savvy investors long ago dropped the “Buy American” motto when investing in the auto industry, but some may still need a little push to purchase Chinese EV stocks. Their current showings should be the only push U.S. investors need when reviewing current trends from Nio and XPeng.

Nio (NIO)

Nio dominates Chinese electric vehicle innovation with its line of vehicles, charging stations and more. Its vehicles are autonomous, showing a vision for the future.

Nio’s sales increases from quarter to quarter are impressive, with an overall boost of 6.8% from the first to second quarters of 2021 and 127% year over year. These numbers reflect a year-over-year revenue increase of 127.2%.

However, supply chain issues are currently pinning Nio’s stock prices down to an extent. Resolution of these issues could create an undervaluation that savvy investors will jump at.

The firm’s plan for advanced electric vehicle service stations that innovate how EV drivers will travel over long distances assures investor confidence in Nio’s future.

XPeng (XPEV)

Counter to Nio is XPeng, one of China’s other gigantic electric vehicle powerhouses. With a 439% year-over-year increase in vehicle deliveries in the second quarter, XPeng is poised to surpass Nio in the numbers game.

XPeng’s sales are comparatively lower, but with consistency even in the face of shortages, XPeng’s projections for the year are solid.

Investors are excited about XPeng’s forays into tech, with its proprietary software XPILOT promising advances in its electric vehicle fleet.

American Electric Vehicle Stocks

Industry leaders on U.S. soil are also demonstrating the continued promise of the EV market, with Fisker and Tesla attracting the kind of attention that bodes well for investors.

Fisker (FSR)

Fisker has a slightly different production method than some of its competitors, which leaves investors curious about how this electric vehicle company will hold up over time. The company is likely to launch its Ocean SUV, manufactured by Magna International, late next year, according to the Los Angeles Business Journal, and it’s currently raising cash to start production on a second vehicle. Fisker’s Project PEAR, or Personal Electric Automotive Revolution, is set to go into production in late 2023 or early 2024.

Building Wealth

Indeed, it appears that Fisker is moving forward into a bright future. Investors expect Fisker’s unique approach to privileging design while outsourcing production will lead to promising results.

Tesla (TSLA)

Tesla is the elephant in the room of EV stock investment. If you walk away from it, you could be leaving serious money on the trading room floor. But is fear of missing out compelling you to buy into Tesla? Are you doing it because of social media buzz and Tesla’s ongoing media popularity?

FOMO and media attention aside, given its recent increases in price targets, Tesla seems to be on a clear path forward for the time being.

Tesla’s Impact and Current Performance

Tesla is not experiencing a sales boom like Nio, yet its year-over-year currently sits at 98.27%. It kicked off 2021 with its best quarter yet, boasting a substantial increase in order delivery. Though Tesla endures occasional slips in prices, its potential for outsized profit is undeniable.

Elon Musk is notorious for his media presence, outspokenness and the corresponding effect of both on stock prices. Most recently, his announcement that Tesla would stop accepting Bitcoin due to energy consumption concerns caused a dip in prices.

Yet Tesla has already begun a post-announcement recovery, highlighting its long-term resilience. With solid expectations of continued growth and success, Tesla remains a favorite EV stock to buy now.

EV Industry Support Stocks

Investing in the support industries around EVs is just as smart as investing in EVs themselves. With huge territories to cover and great growth potential, these well-established charging port companies are poised to drift in the wake of EVs for a long time to come.

ChargePoint (CHPT)

If getting there first counts for anything, ChargePoint wins — as of April, it dominated 73% of the North American charging port market.

As ChargePoint expands into Europe with a three-year plan for increasing its revenue to $1 billion, investors are feeling confident about their ability to make good on these promises.

Blink Charging (BLNK)

Whereas ChargePoint dominates in a single territory, Blink Charging has diversified across the Middle East, Europe and North America, increasing its stock price by 378.91% over the last year alone.

But despite impressive gains and burgeoning sales growth, the stock took a hit on news that the company had a second-quarter loss of $13.5 million, or 32 cents per share, which the earnings statement attributed to increased expenses.

Glitches aside, Blink Charging is a solid EV infrastructure company likely to benefit from government infrastructure investment and more widespread use of EVs among consumers.

Charging Infrastructure Is Coming

The Biden administration has put plans into action for a nationwide charging network. This plan will further integrate alternative fuel corridors to make cross-country travel by EV simpler to plan and more efficient. Investments in existing charging port companies appear favorable in light of this governmental push for EV advancement.

Invest In the Future

Investments far too often feel utilitarian, limited by the demands of the market and the need to make a profit. It’s somewhat rare to make an investment that trends toward excellent returns and makes you feel positive about the future.

But investing in electric car companies lets you do both. Not only do you have great prospects but you can also feel confident in the environmental soundness of your investment and the job creation potential for workers around the globe.

Daria Uhlig contributed to the reporting for this article.

Data is accurate as of Sept. 12, 2021, and subject to change.

Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy.

About the Author

Emily Cahill is a writer with over three years of experience creating digital content. Previous to that, she worked as a freelancer in publishing while attending Trinity College for English/Rhetoric. She specializes in SEO-driven content that highlights the unique properties of a product or service while making them digitally “findable,” particularly for the finance, geek culture, and lifestyle niches.

Untitled design (1)
Close popup The GBR Closer icon

Sending you timely financial stories that you can bank on.

Sign up for our daily newsletter for the latest financial news and trending topics.

Loading...
Please enter an email.
Please enter a valid email address.
There was an unknown error. Please try again later.

For our full Privacy Policy, click here.