The great electric vehicle revolution has run into serious challenges in 2024. Circumstances have conspired to hold back this industry, including factors like higher borrowing costs, fragile economic growth, consumer preference for hybrids over fully electric cars and subsidy cuts in Europe.
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EV stocks have a lot of long-term potential, however. As recently as 2010, global EV sales could be measured in thousands of units, but top manufacturers now have production numbers in the millions. Combustion engines certainly aren’t about to disappear, but the prior years of growth seen by stocks in the industry aren’t disappearing, either.
That said, it may be wise to take a harder look at these companies before investing new money. The best EV stocks are not just those riding the general opportunities, but rather those with a unique value proposition that will help them weather any short-term volatility.
| EV Stock | Market Value |
| Tesla Inc. (ticker: TSLA) | $710 billion |
| BYD Co. Ltd. (OTC: BYDDY) | $90 billion |
| Rivian Automotive Inc. (RIVN) | $13.5 billion |
| Albemarle Corp. (ALB) | $9.7 billion |
| ON Semiconductor Corp. (ON) | $33.3 billion |
| EVgo Inc. (EVGO) | $1.1 billion |
| LiveWire Group Inc. (LVWR) | $1.4 billion |
Tesla Inc. (TSLA)
Market value: $710 billion
First things first: Disappointing earnings numbers along with the divisive behavior of Tesla founder Elon Musk have left a bad taste in the mouths of many investors. But if you can look past the day-to-day internet outrage, it’s easier to see the merits of the company. For instance, in the second quarter, Tesla reported 444,000 vehicles delivered. With an already sizable chunk of the marketplace and continued growth predicted on top of that, it’s hard to pick an alternative if you want to play the growth trend in developed markets. What’s more, shares are up about 20% in the last three months as some investors seem to think the worst is over for this EV stock.
BYD Co. Ltd. (OTC: BYDDY)
Market value: $90 billion
While Tesla dominates the U.S., there are plenty of Chinese companies making a name for themselves, too. Foremost among them is BYD, which already topped the 3 million mark for vehicle production last year. Unlike some dedicated EV stocks, it’s also a big producer of plug-in hybrids to allow it to play to a broader array of consumer tastes. Another interesting point is that BYD is one of the top three EV battery producers in the world, which reduces its reliance on third-party suppliers. While many EV stocks are significantly underwater this year, BYD has managed to eke out a modest gain — a sign of its strength even in uncertain environments. And with home-grown appeal for the critical marketplace of China, BYD has more going for it than even the much-loved Tesla right now.
Rivian Automotive Inc. (RIVN)
Market value: $13.5 billion
While smaller and unprofitable electric vehicle companies have been among the hardest hit by the downturn in 2024, many investors aren’t interested in today’s leaders and instead are looking for fast-growing upstarts. These smaller firms come with larger risks, of course. If this is the strategy you’re after, however, EV truck, SUV and delivery-van manufacturer Rivian is worth a look. In Q2, the company saw growth slow, but perhaps most importantly, it put up noteworthy reductions in its cost per vehicle as it moves toward profitability. What’s more, it has a joint venture in the works with iconic automaker Volkswagen AG (OTC: VWAGY) that is expected to close by the fourth quarter. Shares ran up quickly in June as a result of these headlines, and while they have cooled off a bit, RIVN is still sitting on nearly 30% gains in the last three months to hint that momentum may be moving toward the upside.
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Albemarle Corp. (ALB)
Market value: $9.7 billion
Albemarle is a lithium producer, which is a key component of battery packs used in EVs. Unfortunately, lithium prices have been in a bit of a free fall for the last year or so after hitting a record high of more than $81,000 per metric ton in late 2022 before bottoming out at a low of around $13,000 in June. Like all materials stocks, ALB has been hard-hit by this downtrend in commodity prices. But like Big Oil stocks that rise once fossil fuel prices firm up, or mining stocks that rebound thanks to gold or silver pricing trends, ALB is not necessarily caught in a long-term downtrend. If you’re not as interested in playing the manufacturers of vehicles themselves, ALB is an interesting option based on its unique position in the lithium marketplace.
ON Semiconductor Corp. (ON)
Market value: $33.3 billion
If you’ve never heard of ON Semiconductor, that’s probably because this is a behind-the-scenes firm that specializes in “intelligent sensing and power solutions.” That’s a fancy way of saying it makes chips and sensors used in modern energy applications ranging from green energy to EVs. That includes the components for chargers, traction control and converting DC power. As with the prior lithium stock, ON Semiconductor is a company that isn’t tied to an individual EV company and therefore is a broader play on the trend of electric vehicle adoption versus a particular make or model. With a great specialty and operations that are comfortably profitable, it may be a less sexy but certainly safer bet for EV investors.
EVgo Inc. (EVGO)
Market value: $1.1 billion
Another twist on EVs and the smallest pick on this list is EVgo, a charging network company that currently boasts over 1,000 fast charging locations across more than 35 states. This EV stock is not yet profitable as it invests heavily in future growth, but so far those investments seem to be helping it scale up fast. With more than 50% projected revenue this year and nearly 40% revenue growth forecasted for fiscal year 2025, there’s clearly still a big interest in charging even if EV adoption trends have seemed to flatten out. There are other stocks out there, and competition is still pretty fierce, but strong earnings should give investors a good reason to consider this charging specialist. What’s more, EVGO stock is actually up on the year while other electric vehicle stocks have stumbled in 2024.
LiveWire Group Inc. (LVWR)
Market value: $1.4 billion
The final and perhaps most quirky entrant on the list is LiveWire, which is an electric motorcycle company. Born out of a 2022 spin-off from chopper icon Harley-Davidson Inc. (HOG), LiveWire became a stand-alone firm recently and has been looking to the future of mobility in its own unique way. It’s also projecting a pretty stellar growth path, with fiscal year 2025 revenue predicted to more than double from the current year. As with a lot of EV stocks, however, LiveWire is not yet profitable and is depending on consumers catching on even as it scales up and makes its operations more efficient in the years to come. There are few other options for a dedicated play on the two-wheeler EV market, however, so motorcycle enthusiasts may want to give LVWR stock a look.
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7 Best EV Stocks to Buy originally appeared on usnews.com
Update 08/20/24: This story was previously published at an earlier date and has been updated with new information.
