Thursday, April 25, 2024
Stocks To Buy

7 Most Undervalued Electric Vehicle Stocks to Buy Now

There are a lot more undervalued electric vehicle stocks out there than you may realize.

Though electric vehicle stocks got a hiding this year, there are plenty of reasons to be optimistic about the sector. With some of the top EV stocks down more than 20% to 50%, now is an ideal time for investors to scoop up some undervalued electric vehicle stocks for the long haul.

Supply chain issues that tripped up some companies earlier this year have been largely addressed. The bullish signs emerging for the market could now be a great opportunity to buy into the industry’s finest at a hefty discount.

Stocks in this space still offer the potential for great reward, so investors should take advantage of this moment and invest in the EV stocks discussed in the article before they start gaining again.

BYDDF BYD Company  $24.36
NIO Nio $9.81
LI Li Auto $18.20
LIT Global X Lithium & Battery Tech ETF  $58.42
PTRA Proterra  $3.66
F Ford Motor $10.98
GM General Motors $32.78

BYD Company (BYDDF)

BYD Company (OTCMKTS:BYDDF) stock looks like a clear winner in the booming Chinese EV sphere. Last month, BYD rose to the top of all-electric vehicle sales in China, selling an incredible 113,915 EVs. This marked a 147% increase from last year in November and showed why it’s one of the undervalued electric vehicle stocks to watch for 2023.

It sold 1.2 million vehicles in the first nine months of 2022, and its expansion plans beyond its home market point to a massive growth runway ahead.

With plans to move into more than 15 international markets, its reach extends into such places as Japan, Thailand, Mexico, and multiple European countries. In addition to giving it further access to a global customer base, this level of expansion shows that BYD is serious about its ability to build strong relationships and expand market share in each market.

Nio (NIO)

Chinese EV giant Nio (NYSE:NIO) has seen its shares plummet to new lows in 2022.

NIO stock is down over 70% from its all-time high price, achieved in early 2021. However, recent reports suggest that the worst may be over for the firm regarding its supply chain and production-related issues.

Its December delivery report should show a marked improvement in deliveries. Also, the Chinese government’s pivot away from Covid Zero will benefit Nio in 2023, making it one of the undervalued electric vehicle stocks to make a big comeback.

During a challenging year, Nio delivered 106,671 cars in the first 11 months of the year, an increase of 31.8% from last year. Setting a November record at 14,178 vehicles delivered shows the demand for its vehicles is still strong and growing.

Nio plans to expand even further next year, introducing new models to cater to the demands of its customers in Europe and beyond.

Li Auto (LI)

Li Auto (NASDAQ:LI) is another leading Chinese EV player that has taken a hammering at the stock market this year. However, it performed relatively better than its peers and still looks undervalued over a long-term horizon, making in one of the undervalued electric vehicle stocks to keep on your watchlist.

For the third quarter, Li reported vehicle delivery growth of 5.6% on a year-on-year basis to 26,524 vehicles. Though growth was muted, its 2023 outlook is remarkably bullish on the back of a robust line-up of models. The company’s second model, Li L9, has already received a strong market response. Li L8 and Li L7 will contribute to delivery growth in 2023 and beyond.

Li Auto is well-positioned to take on global expansion thanks to its impressive cash buffer of $7.85 billion, which provides the company with ample flexibility for expansion within China and possibly outside its borders.

Its investment in research and development has been robust, giving this forward-thinking auto company superior command over the latest technological advances.

Global X Lithium & Battery Tech ETF (LIT)

Global X Lithium & Battery Tech ETF (NYSEARCA:LIT) is a great choice for investors looking to capitalize on the growing trend of lithium demand without taking on too much company-specific risk.

This fund offers investors exposure to the entire lifecycle of the mineral, from mining and refining to battery production, giving them maximum diversification within the sector.

Its portfolio of investments covers the full spectrum of lithium and battery tech companies. By investing in market leaders such as Albemarle, Samsung, and Panasonic, they ensure that they have all bases covered, from production to manufacturing and distribution.

Due to global recessionary fears, LIT stock is down over 20% for the year. In due time though, the shares can retake their highs above the $97 mark as lithium demand improves.

Proterra (PTRA)

Shares of Proterra (NASDAQ:PTRA), a leading developer of electric buses, have dropped sharply in value this year. However, there are plenty of reasons to be upbeat about its future.

Under the Biden Administration, funding for electric school buses has increased significantly, nearly doubling to around $1 billion.

There were 2,000 applications made last year to the Environmental Protection Agency to receive funding for over 12,000 electric buses. Hence, the robust demand from state and federal governments for electric buses bodes remarkably well for Proterra. The firm has sold over 1,300 buses to various transit agencies across North America, and its long-term outlook looks mighty encouraging.

Ford Motor (F)

Ford Motor (NYSE:F) is at the forefront of the electric vehicle revolution and plans to invest up to $20 billion in the electrification of its fleet.

The Detroit-based company is investing heavily in its lineup of electric automobiles, from reimagined versions of some of its best-known models like the F-150 and Mustang. To prepare for the shift, Ford created a new subsidiary devoted exclusively to EVs and manufacturing and assembly teams dedicated solely to distributing these cutting-edge machines.

From the investor’s perspective, buying Ford stock now looks quite appealing. The price per share has dropped over 40% compared to last year.

The company offers a generous dividend yield of 4.4%. In short, now is an excellent opportunity for long-term investors to benefit from Ford’s strategic foray into the new EV revolution and reap long-term gains.

General Motors (GM)

With its ambitious electric vehicle goals, General Motors (NYSE:GM) continues to demonstrate its commitment to a greener future.

Their sales record in the third quarter of this year shows that consumers are taking notice and supporting these new green initiatives.

GM’s response is a target increase of nearly 60% in the production of their Chevrolet Bolt EVs and electric SUVs by 2023, which shows that they are ready and willing to meet the demands of their customers.

Not only can customers choose to support an environmental-friendly future, but also GM’s impressive manufacturing capabilities. It’s no wonder GM has become such a leader in innovating EVs.

General Motors’ commitment to EVs is extremely encouraging for both consumers and investors alike. It plans to spend $35 billion on the electrification of its fleet and states that its EV will generate profits matching those of gas-powered vehicles by 2025. 

 On the date of publication, Muslim Farooque 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 Publishing Guidelines

Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.

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