EV stocks have multiplied in Tesla's (TSLA) wake and as electric cars look to go mainstream — but not all are created equal. Some car stocks are more ready than others for an electric future. Here are the top-rated EV makers and EV-related plays.
X- Tesla
- Wolfspeed
- ChargePoint
- Albemarle
- Livent
Best EV Stocks To Buy Or Watch
The charts of most EV stocks are under strain. Broadly, both established automakers and startups are a speculative bet on the growth of electric vehicles, itself seen as a nascent field. Growth stocks led the market sell-off due to rising inflation and interest rates.
The electric-car stocks and EV plays below have the best mix of fundamentals and technicals.
Tesla Stock
Tesla stock, the top auto and EV stock by market capitalization, has an IBD Composite Rating of 88 and an EPS Rating of 77. Tesla (TSLA) also earns an RS Rating of 80, meaning that it has outperformed 80% of all stocks in IBD's database over the past year.
Tesla stock shows a bottoming base, but has undercut its 50-day and 200-day moving averages amid the renewed market sell-off.
Tesla makes four models, primarily the Model 3 sedan and the Model Y crossover SUV. It also plans the Cybertruck, Semi and Roadster, for which launch dates have been pushed back. The global EV leader expects to grow vehicle deliveries 50% annually. In 2021, EV deliveries surged 87% to nearly a million.
WOLF Stock
Wolfspeed (F) has a Composite Rating of 78, EPS Rating of 58 and RS Rating of 97. WOLF stock has been finding support at the 50-day average amid the recent sell-off.
A semiconductor manufacturer, WOLF stock is seen as a play on the growth of electric vehicles. The company makes silicon carbide chips, which can handle higher voltages and are more power efficient than traditional silicon chips. That could mean faster EV charging and improved driving range. WOLF stock earns a spot on the IBD Leaderboard. Peer ON Semiconductor (ON) is on the IBD 50 list.
CHPT Stock
ChargePoint stock bears a Composite Rating of 44, EPS Rating of 10, and RS Rating of 47.
ChargePoint offers 200,000 public places to charge across its EV charging network in North America and Europe. It should benefit from the Inflation Reduction Act, which aims to boost EV charging infrastructure in the U.S. The dearth of public chargers is a bottleneck in the adoption of electric cars. ChargePoint is a relatively young, money-losing company but it's growing revenue at a furious pace.
ALB Stock
Albemarle (ALB) has a Composite Rating of 99, EPS Rating of 89, and RS Rating of 96. ALB stock cleared a 273.78 cup-with-handle buy point in August, but is now back below the entry. Its relative strength line remains near highs.
Albemarle, one of the world's largest lithium miners, expects to benefit from higher lithium prices, as demand outstrips supplies. It's one of the largest providers of lithium for EV batteries. It's also said to own some of the purest lithium mines in the world. The Charlotte, N.C.-based company is expanding capacity. In May, Albemarle twice raised full-year guidance. In 2022, Albemarle earnings are set to more than quintuple per share, as revenue more than doubles.
LTHM Stock
Livent (LTHM) carries a 99 Composite Rating, 78 EPS Rating and 97 RS Rating.
Another lithium play, Livent is riding the global adoption of electric vehicles, which use lithium batteries. For more than six decades, Philadelphia-based Livent has been innovating lithium technology. It produces high-performance lithium compounds for EVs, energy storage systems and lubricants. Livent, like Albemarle, is growing earnings and revenue at scorching levels. It partners with big battery producers and automakers.
Tesla Vs. BYD: Which EV Giant Is The Better Buy?
Are EV Stocks A Good Buy?
Companies with two characteristics generally make the best candidates for stocks to buy and watch, according to CAN SLIM guidelines. First, they need a strong track record of earnings growth. Second, they should be technically strong and be shaping bullish chart patterns.
Most of the new EV startups have neither. Those EV stocks include Fisker (FSR), Canoo (GOEV), Faraday Future (FFIE), Lordstown (RIDE) and Xos (XOS). In fact, many of the startups aren't producing electric vehicles yet.
Get Alerts To Stocks Near Buy Points With IBD Leaderboard
However, Lucid Motors (LCID) and Rivian Automotive (RIVN) have begun selling their first EVs.
Meanwhile, Chinese EV startups like Nio (NIO), Xpeng (XPEV) and Li Auto (LI) sell tens of thousands of vehicles, but aren't yet (or aren't consistently) profitable. Then there are legacy auto giants like General Motors (GM), Ford (F), Volkswagen (VWAGY) and China's BYD Co. (BYDDF), all transforming into EV powerhouses.
EV Battery Stocks, EV Charging Stocks
The growing universe of EV stocks doesn't end with carmakers. A constellation of other companies provide car batteries, car charging stations, electric motors and other EV-related products. Among them are ChargePoint (CHPT), EVgo (EVGO), Blink Charging (BLNK) and Wallbox (WBX).
Hyliion (HYLN) is developing electric powertrains for big-rig trucks. Romeo Power (RMO) makes battery packs for commercial EV fleets. QuantumScape (QS) targets solid-state lithium metal batteries.
Magna (MGA) supplies battery enclosures and e-drive gearboxes. It's also an EV contract manufacturer.
Find Aparna Narayanan on Twitter at @IBD_Aparna.
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