Electric car companies including Lucid Group Inc., Fisker Inc., and Hyliion Holdings Corp. are leading peers in revenue growth as rising interest rates and pandemic restrictions slow demand globally, including in China, the world's largest EV market.
We look at the top three electric car stocks in three categories: the best value, the fastest growth, and the best performance. The data is all from April 11. A key benchmark, the KraneShares Electric Vehicle and Future Mobility ETF (KARS), fell 17% in the past 12 months, compared with a 7% drop in the Russell 1000 Index.
Best-Value Electric Car Stocks
These are the electric car stocks with the lowest 12-month trailing price-to-sales (P/S) ratio. For companies in early stages of development or industries suffering from major shocks, this can serve as a rough measure of a business's value. A business with higher sales could eventually produce more profit when it achieves (or returns to) profitability. The price-to-sales ratio shows how much you're paying for the stock for each dollar of sales generated.
|Best-Value Electric Car Stocks|
|Price ($)||Market Cap ($B)||12-Month Trailing P/S Ratio|
|Niu Technologies (NIU)||3.71||0.3||0.6|
|Proterra Inc. (PTRA)||1.26||0.3||1.0|
|BYD Co. Ltd. (BYDDY)||57.97||84.4||1.4|
- Niu Technologies.: Niu designs and manufactures electric scooters, motorcycles, and bikes for urban travel. The company also offers spare parts, accessories, and maintenance services.
- Proterra Inc.: Proterra provides electric vehicle infrastructure under three different segments: Proterra Powered, Proterra Energy, and Proterra Transit. The company produces electric vehicle drivetrains and batteries for commercial applications, end-to-end charging technology, and electric transit buses. In January, the company produced its first Proterra Powered EV Battery at its new battery production plant in South Carolina. Proterra also said CEO Gareth Joyce was appointed to President Joe Biden's Export Council, a committee focused on International trade policy.
- BYD Co.: BYD develops and makes electric vehicles and similar products. The company sells lithium-ion and nickel batteries for phones, power tools, and electric vehicles. BYD also produces rail transit equipment.
Fastest-Growing Electric Car Stocks
These are the electric car stocks with the highest YOY sales growth for the most recent quarter. Rising sales can help investors identify companies that are able to boost revenue organically or through other means and find growing companies that have not yet reached profitability. In addition, accounting factors that may not reflect the overall strength of the business can significantly influence earnings per share.
However, sales growth also can be potentially misleading for gauging the strength of a business because rising sales for money-losing businesses can be harmful if the company doesn't have a plan to reach profitability.
|Fastest Growing Electric Car Stocks|
|Price ($)||Market Cap ($B)||Revenue Growth (%)|
|Lucid Group Inc. (LCID)||8.03||14.7||876|
|Fisker Inc. (FSR)||5.51||1.8||646|
|Hyliion Holdings Corp. (HYLN)||1.82||0.3||447|
- Lucid Group Inc.: Lucid produces luxury electric vehicles such as the flagship Lucid Air and soon-to-released Lucid Gravity. It said on Feb. 22 that fourth-quarter net income fell by half to $473 million. Lucid produced 3,493 vehicles in Q4, up 53% from the prior quarter.
- Fisker Inc.: Fisker is an electric vehicle manufacturer with plans to release its first line of Fisker Ocean vehicles this year. On Feb. 23, Fisker named ChargePoint Holdings its North American partner for its public charging stations, including more than 210,000 active ports for Fisker EV owners.
- Hyliion Holdings Corp.: Hyliion Holdings sells electrified powertrain components for commercial vehicles through subsidiaries. Hyliion in November completed the acquisition of the KARNO generator technology from GE Additive for $15 million in cash and $16 million in stock. The KARNO technology is expected to be 20% more efficient than conventional generators. The company has also collaborated with Hyzon Motors to develop a fuel cell-powered vehicle that will integrate Hyliion's electrified powertrain into a Peterbilt chassis.
Electric Car Stocks With the Best Performance
These are the electric car stocks that had the smallest declines in total return over the past 12 months out of the companies we looked at.
|Electric Car Stocks With the Best Performance|
|Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|indie Semiconductor Inc. (INDI)||9.29||1.3||32|
|BYD Co. Ltd. (BYDDY)||57.97||84.4||-3|
|Li Auto Inc. (LI)||23.63||23.1||-9|
|KraneShares Electric Vehicle and Future Mobility ETF (KARS)||N/A||N/A||-17|
- indie Semiconductor Inc.: indie is an automotive technology company that supplies semiconductors for electric vehicle applications such as autonomous driving and advanced driver assistance. Last June, indie joined the Russell 2000 Index following the annual index reconstruction. The company also said in February that it acquired Silicon Radar GmbH, a German producer of specialized system-on-chips (SoC) for automotive applications.
- BYD Co. Ltd.: See company description.
- Li Auto Inc.: Li Auto is a Chinese developer and manufacturer of smart EVs whose main product is the Li ONE electric sport utility vehicle (SUV). The company also sells charging stalls and internet connection services for vehicles. Li Auto said on Dec. 9 that President Yanan Shen would resign on Jan. 1, 2023, and would be replaced by chief engineer Donghui Ma. Li Auto surpassed its March delivery expectations with 20,823 vehicle deliveries, an 89% increase compared with March 2022.
Advantages of Electric Car Stocks
There are many advantages to investing in electric vehicle stocks, which have gained since the 2020 presidential election. EV companies are expected to create more than 1 million jobs. If U.S.-made electricity is included in the clean energy industry, that also could benefit electric vehicle companies. There are also possible tax credits, but with the April 18 deadline approaching and strict guidelines for the $7,500 eligible credit, many previously qualified EVs won't continue to carry tax incentives.
The future for electric vehicles and electric car stocks looks promising. In just about a decade, one of every five cars sold is expected to be electric. By 2030, electric vehicles will comprise about half of car sales. Electric vehicles support both technological advancement and concerns about pollution.
Investors who wish to diversify can look for exchange-traded funds (ETFs) that invest in a range of electric vehicle stocks to benefit from a range of electric car industry developments. These types of funds can help minimize risk and provide exposure to a fast-growing sector.
For example, the iShares Self-Driving EV and Tech ETF (IDRV) has exposure to various industries, such as electric vehicles and information technology. It also has a mix of auto and tech stocks. Some of IDRV's top holdings are Tesla, Apple (AAPL), and Toyota (TM).
Analyzing Electric Car Stocks
The electric car market is expected to grow at a compound annual rate (CAGR) of 25.6% from 2019 to 2026.
Investors must take market capitalization, sales and earnings growth, cash flow, and cost of production into account before investing in the sector. Also, electric car manufacturing involves the use of cutting-edge technology, so investors must consider the ability of electric car companies to meet such technological standards.
Finding the top electric car stocks to buy should stretch beyond stocks of the automobile manufacturers like front-runner Tesla. Investors should also seek out and analyze stocks of the companies that make electronic safety equipment, connector systems, batteries, and other components of electric vehicles.
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