On the Agenda
- ChargePoint CHPT With a 39% surge in recent quarterly sales and strategic partnerships with giants like Mercedes-Benz, ChargePoint’s commanding infrastructure role in the blossoming EV sector signals extensive growth avenues.
- BYD Co. BYDDF Outstripping Tesla TSLA with robust vertical integration, BYD’s crown as the world’s top EV producer and status as the second-largest EV battery supplier underscore its influential market position.
- Nio NIO Nio sets itself apart with its innovative battery-as-a-service model and unrivaled safety accolades, coupled with ambitious delivery targets and a resilient comeback in vehicle shipments.
The electric vehicle (EV) sector is a high-stakes race with no clear victor yet. As 2030 approaches, global governments are turbocharging EV adoption to meet environmental goals, fueling demand and revenue growth for EV firms and, in turn, investor appetite for EV stocks. For investors seeking to capitalize on this monumental shift and the choppiness in the stock market, these stocks could be a smarter way to participate in the upside.
ChargePoint (CHPT)
ChargePoint Holdings is poised for significant long-term growth, providing robust charging infrastructure and associated services. Its recent results have shown that the company isn’t slowing anytime soon, delivering double-digit top-line growth in the past five consecutive quarters. Moreover, revenue in the most recent quarter represented a 39% bump in sales, reflecting the fast-growing EV market.
Furthermore, the expansion of EV charging stations by commercial establishments and partnerships, including major companies, including Mercedes-Benz and Volvo VLVLY , signifies more growth opportunities. ChargePoint’s massive European market presence and eligibility for U.S. government contracts after receiving a key security authorization add to its growth trajectory.
While President Joe Biden’s administration has launched a number of initiatives to help U.S. automakers crank out more EVs, the need for infrastructure remains clear. ChargePoint is arguably the company that’s best positioned to help solve this problem, aiming for positive EBITDA by 2024, and its survival and success are likely to lead to more dividends ahead.
BYD Co. (BYDDF)
BYD, a leading Chinese EV company supported by Warren Buffett, surpassed Tesla as the world’s top EV producer last year and is making significant global strides. The company’s success stems from its vertical integration strategy, enabling in-house production of batteries, motors, along critical components, leading to cost reductions and heightened efficiency. Recently, BYD became the world’s second-largest EV battery supplier, emphasizing its key role in the EV sphere.
Despite facing challenges, including an EU investigation into Chinese government subsidies, BYD maintains its expansion in Europe and Latin America, demonstrating its resilience. The company’s commitment to the EV shift is evident in its recent 65% profit increase to $936 million in the second quarter, driven by a record 700,244 vehicle deliveries. BYD’s forward-looking plans include new manufacturing bases in China and a significant facility in Thailand by 2024, confirming its ambitious growth trajectory in the global EV market.
Nio (NIO)
Nio is another giant in the Chinese EV manufacturing realm that continues to face challenges in the past year due to supply chain disruptions and lockdowns. It has demonstrated resilience by bouncing back with strong delivery numbers, delivering 23,520 cars in the second quarter and 55,432 in the third, with significant year-over-year increases in monthly deliveries, culminating in a total of 109,813 vehicles so far this year.
One unique aspect of Nio’s business model is its Battery-as-a-Service feature, which distinguishes it from competitors. The company’s commitment to safety has also been recognized, with its ET5 sedan and SUV EL7 receiving five-star safety ratings, a first in the sector.
Nio continues to innovate, planning new model launches to bolster its market standing. Aiming to increase deliveries to 30,000 per month, the company shows ambition despite its stock price struggles. Although undervalued and facing recent declines, NIO stock holds potential for substantial growth, making it an attractive option for investors willing to stomach the risk en route to robust gains ahead.
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 Equities.com Guidelines.
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