The electric vehicle industry is one of the biggest emerging industries in the world. As it’s in the name, the EV industry is going electric. The EV makers are increasing their production each year as governments target to implement the go green initiative. With all this happening, EV battery makers are big players in the industry. Therefore, investing in Electric Vehicle battery stocks at an early stage is a great option for investors.
Competition to create the longest-lasting, farthest-driving and the cheapest battery has accelerated, with old and new companies joining the race. The growing demand for lithium-ion batteries has opened way space for investors. There are companies involved in Electric vehicle battery supply chains, lithium miners, and many more who are at the advantage of EV market expansion.
Accordingly, we have compiled the five best Electric vehicle battery stocks to buy now that’ll boom in the future.
BYD Company Limited (BYDDF)
BYD Company Limited (BYDDF), famously known as BYD, is an integrated EV company based in China. The company has also become a major player in manufacturing batteries and semiconductors used in its EVs.
BYD has soared over 40% year-to-date in 2021 so far. These days, it’s trading around its average support zone of 52-weeks. Analysts have been quite bullish on the battery maker. The company has experienced an increase in enthusiasm for smart money of late. As of the third quarter of 2021, 37 hedge funds portfolios held BYD stock. It’s an all-time high as the previous number was 36. This means the bullish number of hedge fund positions in BYD stock currently sits at its all-time high. This is good news for BYD as investors see upside in the long run.
One factor that makes BYD stand out in the EV industry is that Warren Buffett is a major shareholder. Warren’s Berkshire Hathaway first bought shares of the battery and EV company in 2008. As of late 2021, Buffett’s company held an 8.2% stake in BYD worth more than $8.5 billion.
BYD EVs are top sellers in China. The company sells five of the top 15 new energy vehicles in the country, where it ranks as the leading overall brand. With good financials and investment parties on BYD’s side, it’s definitely a good electric vehicle battery stock to buy.
Panasonic Corp. (PCRFY)
Panasonic (PCRFY) may be a surprise to most of you guys emerging as a top EV battery producer. The Japanese conglomerate is a large producer of EV batteries. Panasonic has been a partner and supplier of Tesla for many years. The two companies first entered into a supply agreement in 2009.
Despite Panasonic no longer being Tesla’s exclusive battery supplier, the company continues to produce a high volume of batteries for the EV carmaker. The over-the-counter-traded Panasonic is working on for Tesla. The main objective of the company is to store more energy, and have an easier manufacturing process, two keys to reducing battery costs. Reducing battery costs is critical for auto manufacturers seeking to gain market share from internal combustion engine vehicles. Panasonic understands the significance of producing low-cost batteries foreseeing the future demand.
Panasonic is not only limited to Tesla and the company has outreached the industry by expanding its customer base. In 2020, Toyota and Panasonic announced a joint venture to build batteries not only for Toyota but for other customers.
The battery maker remains well-positioned to supply EV batteries to all the major automakers. While Panasonic isn’t a pure-play EV battery company, it’s likely to remain a leader in the sector and maintain its place in the list of electronic vehicle battery stocks.
QuantumScape (QS) is developing solid-state battery technology to increase the range of electric vehicles and enable them to recharge more quickly. The U.S. company is just beginning to test its battery technology at scale. It plans to start producing more than 200,000 batteries annually.
QuantumScape is spending heavily to bring its technology to market. It anticipates 2021 capital expenses to be between $135 million and $165 million. That would still leave it with more than $1.3 billion of liquidity to continue investing in its commercial goals. The company expects to deliver prototype battery samples to EV automakers in 2022. While it will provide batteries for test cars in 2023, and begin commercial battery production in 2024 or 2025.
While QuantumScape believes it has a strong enough balance sheet to cover several more years of development and testing. Investing in the company is relatively risky. If its technology ultimately fails or is a commercial flop, then QuantumScape’s stock could become worthless. But luck favors the braves. Nonetheless, this is a promising EV battery company with immense growth potential in a rapidly growing industry.
QS stock currently sits around its 52-week low range and buying this electric vehicle battery stock at its low will create a huge upside. QuantumScape is a promising EV battery maker and it could be the go-to stock of risk-takers. We believe that QS will give you huge profits in the short term. If the company makes a successful commercial appearance, then it’ll be a billion-dollar company in the long run.
FREYR Battery (FREY)
FREYR Battery (FREY) is a Luxembourg-based EV maker that recently got listed on NYSE. The company produces and sells battery cells for stationary energy storage, electric mobility, and marine applications globally. FREYR also designs and manufactures lithium-ion-based battery cell facilities, which is an additional plus to the company.
The NYSE listing is a critical milestone that supports FREYR’s long-term ambition. That is to decarbonize transport and energy systems by delivering sustainable and cost-effective batteries to energy storage systems. This will surely keep FREY shareholders warm and make them more optimistic regarding the future.
The company has been progressing and has signed several agreements in recent times. One of the recent signings includes its inaugural offtake agreement for at least 31 GWh of low-carbon battery cells. FREY has signed this deal with an undisclosed leading global publicly listed manufacturer and provider of energy storage systems.
FREYR is to deliver at least 31 GWh of battery cells from 2023 to 2028 from its Norwegian manufacturing facilities. The agreement is expected to generate $3 billion in revenues as per the current forecasted market rates.
FREY stock has much to offer following its listing on NYSE. We believe with time; the company will attract more investors. Wall Street analysts expect this electric vehicle battery stock to hit $19 in the near term, which indicates a potential upside of over 90%.
Romeo Power (RMO)
Romeo Power (RMO) is a California-based battery maker focused on the commercial vehicle market. RMO electric vehicle battery stocks have been struggling lately, but the selling pressure may be coming to an end soon. Well, what might push the stock to enter the buying trend?
Romeo Power is working on a long-term supply agreement with truck manufacturer PACCAR, which is in place through 2025. That’s a great sign for the company going forward. Romeo will supply batteries for PACCAR’s Peterbilt 579 and 520 electric trucks, with battery production set to start sometime after 2021.
Romeo’s revenue growth will depend on how quickly the demand for electric trucks accelerates, which is difficult to predict. However, the industry appears poised to eventually go fully electric, putting Romeo Power in a good position to profit.
During the third-quarter results, the company posted strong figures. RMO generated revenues of $5.8 million, a 753% increase over the prior year. The massive rise in Romeo’s revenues has been pushed by its shipments to the Company’s largest customer.
A few other notable developments that Romeo has made lately include the installation of a 1-gigawatt hour capacity at Romeo Power’s Vernon facility. Securing a new facility in Cypress, launching an expansion plan to meet market demand, and working on technology development.
RMO stock lies around its 52-week lows and with all the recent developments, RMO is in the perfect buying zone.