The decade-long surge in some EV stocks has made this sector an attractive one for long-term growth investors. It’s become clear that EVs are here to stay.
Naturally, those looking for long-term growth are likely on the lookout for deals in this space.
Unfortunately, few deals could be had in recent years. Valuation expansion in the EV space has led to skyrocketing market capitalizations across the sector, meaning investors who wanted high-growth exposure had to pay up for it.
Luckily, with the macro environment taking a hard shift recently, there are bargains to be had. Valuations have been compressed due to higher interest rates. To quash inflation, the US Federal Reserve has kept its foot on the gas pedal, raising rates consistently throughout 2022 with no end in sight.
Perhaps valuations can continue to be compressed, leading to further downside. That’s always possible. But at some point, even the most beaten-down stocks will start to appear attractive.
Here are three top EV stocks with incredible upside potential over the long-term, despite discounted valuations that are worth adding to your watchlist and potentially your portfolio.
Despite Nio (NYSE:NIO) incurring significant losses, the stock is still rising due to Wall Street analysts' general bullish outlook, strong demand momentum for its new and existing items, and higher output as a result of its expansion initiatives.
Following the release of Q2 results, Wall Street experts expect Nio (NYSE:NIO) to recover to mid-2021 levels in the next months.
Moreover, nearly 200,000 cars have already been pre-ordered for Nio's newest mid-size sedan, the ET5. This may be one of the reasons Wall Street continues to be optimistic about Nio's prospects despite the business announcing significant quarterly losses last week.
On September 9, Nio (NYSE:NIO) began taking orders for its ET5, and the first shipment is anticipated to arrive by the end of the month.
The ET5 has a lower price range than Nio's previous sedan, the ET7, and is anticipated to compete with comparable mid-size electric cars offered by Tesla (NASDAQ:TSLA), Mercedes (OTC:MBGAF), and BMW (OTC:BAMXF).
Meanwhile, Tesla (NASDAQ:TSLA) has continued to move forward with its intentions to increase the number of Supercharger stations in China, adding 40 new locations in August alone.
According to a post on Tesla China's official Weibo account, 40 more stations totalling 168 additional stalls were added in 25 locations. These new Superchargers are available in several cities, including Chengdu, Chongqing, Zunyi, Wuhan, Nantong, and Shanghai.
In the course of the 31-day month, Tesla (NASDAQ:TSLA)added 1.29 new stations per day, a little fewer than the 48 Superchargers the company was able to deploy in China in July.
Tesla further verified that every new station was a V3 Supercharger, capable of charging vehicles at up to 250kW.
The business's new Supercharger facility in China has made this quick expansion feasible. The plant, which can produce up to 10,000 Superchargers annually, was finished in July 2021.
Tesla’s (NASDAQ:TSLA) network in China now includes more than 1,300 stations with more than 9,000 stalls nationwide thanks to the rapid rate at which new Superchargers have been constructed over the past several months.
According to Tesla China, there are also over 1,800 Destinations chargers in over 380 towns and regions, letting owners to plug in and receive a charge at Level 2 charging rates.
XPeng (NYSE:XPEV) just announced the upcoming launch of its fourth production vehicle, the flagship G9 SUV.
XPeng (NYSE:XPEV) says the G9 will target the medium-to-large smart electric SUV market and is larger and more technologically advanced than its G3i counterpart. Before the month is over, the company intends to release the new model.
The company also announced the launch of its new pilot program for the City Navigation Guided Pilot (NGP) has also been launched. The new initiative will make it the first Chinese automaker to introduce advanced ADAS features for challenging urban driving conditions.
Before being made available in other locations, Chinese-based consumers will be able to obtain City NGP via over-the-air updates, marking a significant development in the field of autonomous driving.
Clearly, EV stocks are working to retain their market share and remain competitive. It will be interesting to see which stock can stand the test of time and claim the top spot in the surging industry.
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