Electric vehicle sales are quickly accelerating, and consequently, electric vehicle stocks are ready to rev their engines. In fact, according to Bloomberg, Americans bought 977,445 EVs year-over- year (YOY) through June.
“It took 10 years for the U.S. to sell its first million fully electric vehicles, two years to reach the second million, and just over a year to reach the third. By the time the latest quarter’s figures are tallied up over the next month, the country should be well on its way to a fourth,” they added.
All of which is great news for EV stocks.
Granted, there are still some roadblocks to mass U.S. adoption, including a lack of EV charging stations, EV metal shortages, and higher costs, but once those issues are fixed, we could see millions of EVs on the road. Helping, the Biden Administration still wants at least 50% of all new auto sales to be electric by 2030.
That being said, I’d back up the truck on all electric vehicle-related stocks now, including:
Electric Vehicle Stocks: Albemarle (ALB)
By now, you know the U.S. must secure far more lithium supply to meet demand. You know companies like Ford Motor (NYSE:F) and General Motors (NYSE:GM) are inking deals with lithium miners to secure supply. And you know that some miners are nervous they won’t be able to meet demand. That being said, you want to own beaten-down lithium stocks, like Albemarle (NYSE:ALB).
After slipping from $245 to $162.41, ALB is excessively oversold at current prices. It’s also technically over-extended on RSI, MACD, and Williams’ %R. Additionally, it’s sitting at major support dating back to early 2022, where it tends to bounce.
Plus, earnings have been incredible. In its second quarter, the company’s adjusted EPS came in at $7.33 on $2.4 billion in sales. That was above expectations for EPS of $4.48 on $2.4 billion. While those numbers are down quarter-over-quarter, it was because of what I consider to be temporary lithium pricing weakness.
BYD Co. (BYDDF)
You may also want to keep an eye on BYD Co. (OTCMKTS:BYDDF), another one of the hottest electric vehicle stocks. While it’s been a volatile year for the EV stock, it still ran from a low of about $25 to a current price of $30.50. From here, I’d initially like to see it retest $36 resistance. Helping, the company sold 274,386 vehicles last month – a 4.7% month-over-month jump, and a 57.7% jump YOY. All thanks to global demand.
Plus, despite China’s economic issues, BYD is still achieving solid growth. In the first six months of the year, revenue soared about 29% YOY. It even expanded its gross margins to 7.8% from 5.3%.
Even more impressive, according to the China Association of Automobile Manufacturers, “the sales volume of new energy vehicles in the first half of 2023 reached 3.747 million units, representing a year-on-year growth of 44.1%, and its market share increased significantly from 21.6% in the first half of 2022 to 28.3%,” as quoted by Motley Fool.
That means Chinese consumers are aggressively buying EVs even with the economy not looking so hot.
Li Auto (LI)
Another beaten-down EV stock to buy and hold for the long haul is Li Auto (NASDAQ:LI). For one, the company just delivered 36,060 vehicles in September, or 212.7% YOY growth. A month earlier, it delivered 34,914 vehicles, an increase of 663.8% YOY. Both helped push third-quarter deliveries up 296.3% YOY to 105,108.
Earnings haven’t been too shabby either. In fact, in its second quarter, the company posted EPS of 36 cents, which beat expectations by 17 cents. Revenue of $3.95 billion, or 228.1% YOY growth beat estimates by $150 million. Better, Q2 deliveries jumped to 86,533, which was a YOY increase of 201.6%.
With Li Auto, I’d use any weakness as a strong buy opportunity. From its current price of $35.19, I’d like to see Li Auto initially retest its prior high of $47.33.
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