3 EV Stocks Poised to Be Portfolio Outperformers in 2024
Amidst high inflation, interest rates, and reduced EV demand, the U.S. market recorded a record 1.2 million EV sales in 2023. However, Chinese EV producers came out ahead, reporting stellar numbers and leading the way in terms of market share. For cost-conscious investors, exploring potential next-gen EV leaders is vital in 2024.
Despite temporary challenges like heightened competition, macroeconomic factors, and supply-chain issues, the EV sector presents fresh entry points. With geopolitical tensions impacting growth, undervalued EV stocks offer diversified investment opportunities beyond car makers.
Byd Co. (BYDDF)
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Warren Buffett-backed BYD Co. (OTCMKTS:BYDDF) is the world’s largest EV seller and second-largest battery maker. It achieved impressive Q4 deliveries of 526,000 EVs, marking its dominance. So, with a 100% year-over-year (YOY) profit surge, expanding international exports, and plans for new factories, BYDDF presents a compelling investment opportunity at $26.
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Despite Byd Co.’s record-breaking EV sales, surpassing Tesla (NASDAQ:TSLA) in the latest quarter, the Chinese EV maker’s shares have plummeted 45% from the 2022 peak. Also, concerns have arisen due to price wars, slowing sales growth, and increased discounts in the competitive market.
However, BYDDF’s global market presence and diverse EV lineup, including plug-in hybrids, contribute to a robust market share. Despite a recent market dip, BYDDF has strong financial indicators and impressive vehicle deliveries. And those position it as a compelling Tesla competitor, emphasizing affordability without compromising quality.
In 2023, Byd Co. achieved substantial YOY growth, selling 3.02 million vehicles and reinforcing its global standing in the expanding EV market.
Lithium Americas (LAC)
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Lithium Americas (NYSE:LAC), or Lithium Argentina, exceeded its 2023 production goal at the Caucharí-Olaroz lithium brine operation in Argentina.
By producing nearly 6,000 tons of lithium carbonate, it surpasses the initial 5,000-tonne target. The plant operates at half capacity. And ongoing efforts are boosting production and improving product quality. Also, the potassium chloride (KCl) plant is operational, with plans to increase production.
Lithium Americas presents potential for significant growth, trading at $6 per share at the time of writing. Despite challenges in the lithium sector, gradual accumulation is advisable. Keep in mind its ownership of the Thacker Pass project, the largest known measured lithium resource in the U.S. With a $5.7 billion after-tax net present value, and General Motors’ (NYSE:GM) $650 million investment and ten-year off take agreement, the current $1 billion market valuation seems undervalued.
Regular shipments commenced in October. Also, Lithium Americas plans to release Q4 and full-year 2023 financial results on March 21, 2024. Executive Chair John Kanellitsas expressed satisfaction with the project’s transition to operations. He especially emphasizes the goal of reaching full capacity in 2024 and enabling further growth.
Li Auto (LI)
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Li Auto (NASDAQ:LI) exceeds revenue expectations with robust December deliveries of 50,353 vehicles.
Impressively, that marks a 137% YOY increase. Also, Q4 deliveries reached 131,805, up 184% YOY, setting the stage for a strong quarter. Therefore, the company anticipates Q4 revenue between $5.27 billion to $5.40 billion.
The Chinese EV company emerges as the top-selling SUV brand above 300,000 yuan in China for November, with 41,800 units sold. This marks the eighth consecutive month of Li Auto’s dominance in this category. In the over 200,000 yuan segment, Li Auto has secured second place in the market.
With ambitious December sales goals, Li Auto aims to maintain its lead in these price classes until year-end. A recent collaboration with Nvidia (NASDAQ:NVDA) for autonomous driving, utilizing Nvidia’s DRIVE Thor, holds promise for future growth, consolidating multiple functions into a single AI platform. With all of these under LI, the future looks bright and clear for the company.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.
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