It doesn’t matter how you look at it, the electric vehicle revolution is only going to continue in 2021.
President Biden has already committed to spending $174 billion on boosting the electric vehicle market.
Every major car company on earth is now pursuing its own EV project.
And demand for electric vehicles is soaring around the globe as governments race to reduce emissions.
In the last year alone:
Tesla’s stock price soared by 256%...
Chinese EV giant NIO handed investors an incredible 816% return...
And GM saw its stock price jump 211% as it pivoted towards electric vehicles.
The only real headache for investors looking to get in on the hottest sector of the year is figuring out which of these EV stocks have the most upside potential.
And when it comes to identifying upside potential, it is always best to focus on the potentially disruptive companies that are yet to grab the headlines…
An obvious candidate for those familiar with the EV space is Fisker (NYSE:FSR). This up-and-coming EV maker has an asset-light business model that means it can specialize in one thing and one thing only - building EVs. Its recent deal with Foxconn is a clear sign that Fisker means business, and its first car should be coming to market in late 2022.
Another potential disruptive stock to watch in 2021 related to the EV industry is Facedrive (TSXV:FD; OTC:FDVRF), a little-known Canadian startup that is attempting to connect the EV industry with the multi-trillion-dollar subscription service industry. And it doesn’t stop there, Facedrive is also competing in the ride-sharing and food delivery space with its zero-emissions or carbon reduced EV-focused services.
Finally, with Biden determined to kickstart a major infrastructure renovation in the U.S., Blink Charging (NASDAQ:BLNK) has plenty of blue-sky potential in the future. The company provides EV charging equipment and networked EV charging services across the U.S. and is sure to win big regardless of which EV giant eventually dominates the industry.
Anything EV and EV Related Is Golden Right Now
In 2021, we think you really can’t go wrong in the EV space.
The $40-trillion energy transition is well and truly underway, and transportation is at the very heart of this global shift.
But as Elon Musk picks fights with everyone from the SEC to the entire cryptocurrency community, while short sellers continue to target the biggest name in the EV space, it is clear that Tesla is slowly losing its appeal.
For investors looking for a pure-EV play that could outperform Tesla in the coming year, Fisker has all of the pull that Tesla did when it was first starting out. And once Fisker hits production, it is going to be dealing with far fewer overheads and problems than Elon Musk’s ever-expanding car giant has. Fisker’s recent deal with Foxconn, the Taiwanese company that assembles iPhones, has investors very excited indeed - with the partnership aiming to produce an exciting new electric vehicle by the end of 2023. For a stock that is trading at slightly over $10, the upside is undeniable.
The only caveat--which is exactly what makes this a great time to get in early--is that Fisker isn’t going to start producing its famed Ocean SUV until late 2022, with significant revenues coming in from advance orders not expected until late 2021.That means this is a long-term hold, and one that plenty of Wall Street appears not to have enough patience for. But the bearishness on Fisker reminds us an awful lot of the prior relentless bearishness on Tesla, and we all know how that went.
Now, if you are doubtful that newcomers to the EV market can compete with the likes of Tesla, GM, and Volkswagen, then there are plenty of other exciting ways to play the EV boom. Facedrive - one of the most fascinating companies to come out of Canada’s ‘Silicon Valley’ in a long time - is approaching the EV market in a very different way. Its flagship carbon-offset ride-sharing and food delivery service has already proven to be popular, but now it is moving into the fast growing subscription industry.
The thesis here is that we aren’t just living through the golden age of EVs … we are living through a transformation of how we as humans interact with our planet.
Facedrive (TSXV:FD; OTC:FDVRF), which describes itself as a ‘planet and people first’ company, is viewing the EV industry as just one part of a much larger formula. And it has a knack for spotting great deals and acquiring innovative, well-placed companies to fit into their ecosystem.
Its acquisition of Steer, which took place in September 2020, is what really excited EV analysts about this company. Steer is a subscription company that gives consumers their own private virtual EV showroom where they can select the car they want to drive each month. It is a new way to look at car use and a format that will make EVs accessible to an entirely new set of consumers.
With Steer, you get to drive a collection of the best EVs on the market, with scenarios for a range of budgets and tastes. No added insurance necessary. No maintenance. No hassle whatsoever. It’s the best in on-demand concierge services, and we fully expect it to transform the industry.
Even more excitingly, Steer was part of the $40B market cap energy giant Exelon (NYSE:EXC). So the big names are already interested in what could become the next big EV vertical to watch in our ever-changing world
Finally, no matter who wins the EV war in the end, the real winners in this space are the charging companies that get to take advantage of all that extra demand.
If you are looking for a long-term hold, then Blink Charging is a no-brainer for investors who believe the U.S. will soon have a charging station at every gas station in the U.S.
Biden has made it clear that he wants to pump $2 trillion into renewable energy infrastructure, and nothing speaks to EV infrastructure right now like charging does.
Blink owns, operates, and provides EV charging equipment and networked EV charging services in the United States. It’s not a new company … it’s been biding its time, and that time is now. That’s why its shares have soared from $3 to over $30 in the last year.
Each of these companies has plenty of upside right now in an industry that is going from strength to strength, but that doesn’t mean you can’t also win big by betting on some of the sector’s more traditional players.
Tesla (NASDAQ:TSLA) may have seen its stock price fall over the past month as inflation fears grow and Elon Musk continues to be his controversial self, but this EV and clean energy giant is going to do well in the energy transition. It is still worth more than half a trillion dollars, more than the top three American automakers--GM, Ford and Chrysler— combined.
Tesla’s stock has skyrocketed by over 14,000% since it first released the Tesla Roadster in 2008. And it’s not just about cars, either. Musk is looking towards a much bigger picture, building the foundation for an electrified future on all fronts. So while competition may be heating up in the EV space, it is likely to see revenue increasing across the board as energy storage and clean energy teach continues to boom. The main threat to Tesla’s global dominance, however, appears to be coming from China.
Just a year ago, no one could have imagined how successful the NIO Limited (NYSE:NIO) was going to be. In fact, many shareholders were ready to write off their losses and give up on the company. But China’s answer to Tesla has outperformed even the most ambitious forecasts and somehow managed to keep its balance sheet in line. And it’s paid off. In a big way. The company saw its share price soar from $3.24 at the start of 2020 to a high of $61 in February, representing a massive 1600% return for investors who held strong.
The Chinese giant then suffered major losses in March as inflation fears combined with weaker than expected earnings and a shortage in semi-conductors to send the stock tumbling by nearly 50%. But it now appears to have stabilized and the future remains bright for a company producing in a country where EV demand is set to soar in the coming decade.
The EV up-and-comer turned things around before, notably following its rumored potential bankruptcy in 2019, and it would be a brave investor who bets against them to do it again. NIO’s CEO, William Li, is as skilled and ambitious as anyone in the business.
Li Automotive (NASDAQ:LI) is the newest Chinese electric vehicle darling. Founded just five years ago by Li Xiang, and backed by domestic investment giants Meituan and Bytedance, Li has taken a different approach to the electric vehicle market. Li specializes in plug-in hybrid vehicles. This means it can be powered by electricity or gasoline, or a mixture of both, giving customers a wider array of fueling options compared to its competitors. Its fashionable crossover SUV has been a hit in China, and thanks to its success, its garnered a lot of investor interest.
Since going public on the NASDAQ in July, the company has seen its share price more than double. Especially in the past month. It’s already worth more than $30 billion but many are saying that it is just getting started. With estimates suggesting that there could be as many as 125 million electric vehicles on the road in the next ten years, and a growing call to ban gasoline-powered cars, companies like Li are sure to grow exponentially.
When it comes to charging stations, Blink Charging isn’t the only player in the game. Billionaires couldn’t keep their hands off Plug Power (NASDAQ:PLUG) this year, with giant BlackRock’s Larry Fink piling in heavily, alongside other heavy hitters. Why? Partly because Plug Power is already providing its hydrogen-powered tech solutions to big-name retailers, but overall, because the green revolution is clearly happening and unfolding as we speak. It helps that Plug's full-year guidance implies year-on-year sales growth of around 35%, even if profit won’t come for a while.
Morgan Stanley's Stephen Byrd believes green hydrogen will become economically viable quicker than investors appreciate saying Plug Power's deal with Apex Clean Energy to develop a green hydrogen network using wind power offers a chance to tap into "very low cost" renewable power and helps accelerate the shift to clean energy. Plug has a goal for over 50% of its hydrogen supplies to be generated from renewable resources by 2024.
Facedrive isn’t the only exciting EV related stock in Canada, either. GreenPower Motor (TSX:GPV) produces larger-scale electric transportation and is grabbing plenty of attention. Right now, it is primarily focused on the North American market, but the sky is the limit as the pressure to go green grows. GreenPower has been on the frontlines of the electric movement, manufacturing affordable battery-electric busses and trucks for over ten years. From school busses to long-distance public transit, GreenPower’s impact on the sector is undeniable.
Year-to-date, GreenPower Motor has seen its share price soar from $2.03 to a yearly high of $43.62. Just like most companies in this space, inflation fears and semiconductor shortages sent the stock tumbling in 2021, but the upside here is undeniable as the EV revolution kicks into high gear.
NFI Group (TSX:NFI) is another one of Canada’s premier electric bus producers. Though it has not yet rebounded to its January highs, NFI still offers investors a promising opportunity to capitalize on the electric vehicle boom at a discount. In addition to its increasingly positive financial reports, it is also one of the few in the business that actually pays dividends out to its investors. This is huge because it gives investors an opportunity to gain exposure to this booming industry while the stock is cheap and hold steady until the market finally discovers this gem.
Westport Fuel Systems (TSX:WPRT) is a unique way to get in on the green boom in the auto industry. It helps build the tools needed for carmakers to incorporate less damaging fuels like natural gas. Though natural gas doesn’t get quite the attention as electric vehicles do, there are over 22.5 million natural gas vehicles on the road across the globe. And that market is expected to grow as the energy transition really takes off.
Speaking of the energy transition, Canadian companies are winning big in this realm as well. Telecom giant Shaw Communications Inc (TSE:SJR.B) is a great example. Shaw is taking a leadership role among Canadian companies in its use of renewable energy. Though its telecom business is its primary focus, it’s betting big on the energy transition as well, holding a stake in renewable projects across the country. In fact, it is one of the biggest customers of Bullfrog Power which sources its electricity from a blend of wind energy and hydropower.
BCE Inc. (TSX:BCE) is a household name in Canada. Everyone knows the company and knows what it is about. For the past 25 years, BCE has been at the forefront of the environmental movement. Their environmental management system (EMS) has been certified to be ISO 14001-compliant since 2009. Throughout its push into the position of one of Canada’s top telco groups, it has bought and sold a number of different firms. That’s great news for the company and its investors.
When it comes to the energy transition, there are a million different ways to play the boom, but if you want to maximize the upside of the EV boom - there are really 3 stocks to watch.
By. Natalie Catley
**IMPORTANT! BY READING OUR CONTENT YOU EXPLICITLY AGREE TO THE FOLLOWING. PLEASE READ CAREFULLY**
This publication contains forward-looking information which is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ from those projected in the forward-looking statements. Forward looking statements in this publication include that the demand for ride sharing services will grow; that Steer can help change car ownership in favor of subscription services; that new tech deals will be signed by Facedrive and deals signed already will increase company revenues; that Facedrive will achieve its plans for manufacturing and selling Tracescan devices; that Facedrive will be able to expand to the US and globally; that Facedrive will be able to fund its capital requirements in the near term and long term; and that Facedrive will be able to carry out its business plans. These forward-looking statements are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Risks that could change or prevent these statements from coming to fruition include that riders are not as attracted to EV rides as expected; that competitors may offer better or cheaper alternatives to the Facedrive businesses; changing governmental laws and policies; the company’s ability to obtain and retain necessary licensing in each geographical area in which it operates; the success of the company’s expansion activities and whether markets justify additional expansion; the ability of the company to attract drivers who have electric vehicles and hybrid cars; and that the products co-branded by Facedrive may not be as merchantable as expected. The forward-looking information contained herein is given as of the date hereof and we assume no responsibility to update or revise such information to reflect new events or circumstances, except as required by law.
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