In this article, we discuss the 10 best battery stocks to buy now according to short sellers. We also discuss the latest updates around the electric vehicle and battery market.
Electric vehicles are the latest trend in the automotive market which is revolutionizing the whole industry. According to Grand View Research, the global electric vehicle (EV) market was valued at $1.07 trillion in 2023 and is projected to grow at a compound annual growth rate (CAGR) of 33.6% from 2024 to 2030 and reach $8.85 trillion by the end of the forecast.
The growth is driven by government policies, incentives, and advancements in battery technology, which are making EVs more affordable and appealing. The transportation and logistics sectors are increasingly adopting EVs due to their lower emissions and operational costs, with companies like Amazon integrating electric trucks into their fleets.
Similarly, Grand View Research believes that the global EV battery market was valued at $44.69 billion in 2022 and is projected to grow at a CAGR of 21.1% from 2023 to 2030. Strategic collaborations among battery manufacturers, e-mobility providers, and energy suppliers are improving battery durability and lifespan, while the increasing production of EVs in countries like China, Germany, and Japan, along with government investments in EV charging infrastructure, is further accelerating the market. However, fluctuating raw material prices, such as lithium-ion, could impact production costs.
The Growing Importance of Critical Minerals in Energy Transition
According to BP’s Energy Outlook 2024, the transition to a low-carbon energy system will require a substantial increase in the use of critical minerals, such as copper, lithium, and nickel, essential for supporting the infrastructure and assets needed for this transition. According to the report, the rapid expansion of electric vehicles is projected to reach 1.2 billion (current trajectory) to 2.1 billion (goal to reach Net Zero) by 2050, which will significantly increase the demand for batteries and in turn, higher demand for minerals like lithium and nickel.
Copper demand is expected to rise by 75-100% by 2050, mostly due to its use in EVs and the extension of electricity networks. Lithium demand could grow 8 to 14 times by 2050, mainly driven by its use in EV batteries, which will account for about 80% of total lithium demand by 2050. Lastly, nickel demand is projected to increase two to three times by 2050, with most of this growth linked to lithium-ion batteries in EVs.
How Competitive Pricing and Leasing Are Shaping the EV Market
In an interview at CNBC Power Lunch, Erin Keating, Cox Automotives executive analyst, explored the factors shaping the EV market. She noted that Tesla and Chevy initially dominated EV sales, which is why a growing supply of used cars from the former is now available. These used EVs have become more affordable, partly due to tax credits of up to $4,000. This is helping to drive sales in the used EV market and making it a more attractive option for consumers.
However, the lease market is offering deals that compete with used EV prices. According to Keating, while this puts downward pressure on used EV prices, she emphasized the benefit of the situation and said that more leased vehicles today will enter the used market in a few years, which will ensure a steady supply of affordable used EVs in the future.
Keating also addressed the issue of buyer’s remorse, as some people are frustrated with the slower development of EV infrastructure and range anxiety. Despite this, she reassured consumers that the batteries in used EVs are holding up well with minimal degradation.
It means consumers can trust the longevity of these vehicles, and automakers are committed to supporting them. Although some challenges remain, she believes that as infrastructure improves, consumer confidence and adoption of EVs will continue to grow.
With that, we take a look at the 10 Best Battery Stocks To Buy Now According to Short Sellers.
10 Best Battery Stocks To Buy Now According to Short Sellers
Our Methodology
For this article, we used stock screeners and ETFs including Amplify Lithium & Battery Technology ETF and Lithium & Battery Tech ETF to identify companies involved in the EV battery market. We then selected 10 stocks with the smallest short interest and listed them in descending order of their short interest. We also mentioned the hedge fund sentiment around each stock which was taken from Insider Monkey’s database of over 900 elite hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Best Battery Stocks To Buy Now According to Short Sellers
10. Lucid Group, Inc. (NASDAQ:LCID)
Short Interest as % of Shares Outstanding: 10.94%
Number of Hedge Fund Holders: 14
Lucid Group, Inc. (NASDAQ:LCID) is an American company that focuses on the design and production of EVs and advanced powertrain systems. The company was founded in 2007 as Atieva and was focused on electric vehicle batteries and powertrains. In 2016, it was rebranded as Lucid Motors and started designing high-performance, all-electric vehicles.
The company sells its EV under the name of Lucid Air, while Lucid Gravity, its all-electric SUV is expected to be available by the end of 2024. In addition to its own vehicle production, the company develops and supplies powertrain systems to other automakers, such as Aston Martin. This diversification shows its role in the broader EV and battery market. It is one of the best battery stocks to buy now.
On August 5, Lucid (NASDAQ:LCID) announced a significant financial move as it secured an additional $1.5 billion in funding from its major shareholder, Saudi Arabia’s Public Investment Fund (PIF).
This new investment includes $750 million from the sale of convertible preferred stock and another $750 million from a delayed draw loan facility provided through an affiliate, Ayar. This funding follows a previous $1 billion investment from PIF in March, which brings their total investment in the company to about $8 billion.
The $1.5 billion in funding is significant for Lucid (NASDAQ:LCID), which will help cover both its investment in new projects and ongoing operational expenses as it scales up production for the Gravity SUV. This financial backing sets the stage for the company to expand its reach and target a broader segment of the market, moving beyond its current focus on premium electric sedans.
Lucid (NASDAQ:LCID) was held by 14 hedge funds in the first quarter and the stakes amounted to $30.4 million. SCGE Management initiated a position with 5.1 million shares worth $13.35 in the quarter and is the largest shareholder of the company, as of June 30.
9. Sigma Lithium Corporation (NASDAQ:SGML)
Short Interest as % of Shares Outstanding: 10.22%
Number of Hedge Fund Holders: 20
Sigma Lithium Corporation (NASDAQ:SGML) focuses on exploring and developing lithium resources in Brazil. It is a key player in the lithium-ion battery supply chain, especially in the electric vehicle industry worldwide. The company fully owns several properties, including Grota do Cirilo, Genipapo, Santa Clara, and São José, which together cover around 185 square kilometers in Minas Gerais, Brazil. It takes the 9th spot on our list of the best battery stocks to buy now according to short sellers.
Sigma Lithium (NASDAQ:SGML) has made environmental, social, and governance (ESG) principles a core focus. It emphasizes on protecting local ecosystems, contributing positively to surrounding communities, and playing a significant role in the global transition to electric energy. It achieved Net Zero in 2023.
The company also showed its strong market position in the second quarter as it raised its sales volume and achieved prices that were 10% higher than those of its competitors. Sigma Lithium (NASDAQ:SGML) generated a revenue of C$62.86 million, which was up nearly 69% sequentially. Moreover, the company cut its cash costs by 22%, increased its profit margins to 54%, and surpassed its financial goals.
On August 29, the company secured a BRL 487 million (1 BRL = US$ 0.18) development loan from Brazil’s National Bank for Economic and Social Development (BNDES) to fully fund the construction of its Second Greentech Carbon Neutral Plant in Brazil. The company has already begun construction and expects to complete it by the summer of 2025.
The 16-year loan, with a low 7.45% interest rate, is a key part of Sigma Lithium’s (NASDAQ:SGML) strategy to double its production capacity of environmentally sustainable lithium concentrate from 270,000 tonnes to 520,000 tonnes annually. The company’s CEO, Ana Cabral said that the support of BNDES strengthens the company’s leadership in the global lithium market and its impact on Brazil’s “Lithium Valley,” transforming the once impoverished region into a thriving hub for lithium production.
In the second quarter, 20 hedge funds had stakes worth $89.1 million in Sigma Lithium (NASDAQ:SGML). Appian Way Asset Management is the company’s most prominent shareholder with 2.6 million shares worth $31.3 million, as of June 30.
8. NIO Inc. (NYSE:NIO)
Short Interest as % of Shares Outstanding: 9.25%
Number of Hedge Fund Holders: 20
NIO Inc. (NYSE:NIO) is making notable strides in the EV sector with its innovative approach to both vehicle design and energy solutions. The company is engaged in designing, developing, and selling smart electric vehicles in China while also providing a range of power solutions. These include home charging systems like Power Home, a battery swapping service known as Power Swap, and a variety of other charging options such as Power Charger, Destination Charger, and Power Mobile.
A standout feature of the company’s offerings is its Battery as a Service (BaaS) model. This approach allows customers to buy the company’s vehicles without the battery, which reduces the upfront cost. Instead, customers can lease the battery, gaining the advantage of accessing the latest battery technology as it evolves. This model not only lowers the initial purchase price but also provides flexibility for customers who can upgrade their battery packs as new innovations become available.
Its Power Swap technology is another key element of its approach. The company has developed a system that enables drivers to quickly exchange depleted batteries for fully charged ones at dedicated swap stations. This process, which takes just three minutes, addresses one of the major challenges of EV ownership, long charging times. With over 2,400 battery swap stations currently operational in China, the company plans to expand this network by adding 1,000 more stations in 2024, aiming for a total of over 3,000.
On the technological front, NIO (NYSE:NIO) is advancing its battery capabilities with the development of 4680 battery cells and lithium manganese iron phosphate (LMFP) batteries, which offer improved energy density and performance.
Recently, the company began mass production of its 150 kWh semi-solid-state batteries. These batteries are expected to improve both energy density and safety and will be featured in several NIO models, starting with the ET7 sedan, which has a driving range of over 1,000 kilometers on a single charge.
The company’s battery swap technology has already achieved 50 million cumulative swaps, which is evidence of its popularity among consumers who prefer it over traditional charging methods. This service has saved users more than $2.85 billion compared to gasoline-powered vehicles.
Additionally, as the number of new energy vehicles grows, approximately 20 million batteries are projected to reach the end of their eight-year warranty period between 2025 and 2032, according to the company. This potential wave of costly battery replacements could drive more consumers toward its battery leasing and swapping options.
Overall, NIO’s (NYSE:NIO) innovative battery solutions and its comprehensive power infrastructure position it strongly in the evolving EV battery market. Its efforts to improve battery technology, expand its swap station network, and position in the market place the company among our best battery stocks to buy according to short sellers.
At a stake value of $82.117 million, 20 hedge funds held positions in NIO (NYSE:NIO) in the second quarter. As of Q2, Point72 Asset Management is the top shareholder in the company and has a position worth $26.89 million.
7. Solid Power, Inc. (NASDAQ:SLDP)
Short Interest as % of Shares Outstanding: 7.82%
Number of Hedge Fund Holders: 14
Solid Power, Inc. (NASDAQ:SLDP) is a Colorado-based company that focuses on developing solid-state battery technology for EVs and various other industries across the U.S. The company provides sulfide-based solid electrolytes and licenses its proprietary cell designs and production techniques.
Its proprietary sulfide solid electrolyte technology significantly boosts safety and improves energy density by 50-75% over traditional batteries, making it an attractive option for a range of uses such as EVs, portable electronics, and aerospace applications.
The company focuses on creating and producing all-solid-state battery cells and manufacturing sulfide solid electrolytes for other producers. The company has set up pilot production lines to fine-tune its cell designs and offer different cell sizes, which facilitates collaborations with leading automotive manufacturers. It is one of the best stocks to buy now according to short sellers.
Solid Power’s (NASDAQ:SLDP) management is quite optimistic about its future. At its latest earnings call, the management discussed its focus on expanding its electrolyte production and market reach, improving its A-2 cell designs, and strengthening partnerships with major players like SK On, Ford, and BMW. Progress is being made on various fronts, including increased electrolyte sample shipments and advancements in cell design, which is aimed at higher performance and safety.
Moreover, they said that significant collaborations are underway, particularly with SK On in Korea, where the company is working towards the installation of an EV cell production line by mid-2025. Solid Power (NASDAQ:SLDP) is deepening its relationships in Korea and Japan to further engage with the battery ecosystem in those regions. Additionally, the company is continuing to work closely with BMW on improving cell performance and preparing for potential future collaborations, including BMW’s demo car program.
On August 7, Needham analyst, Chris Pierce issued a Buy rating on Solid Power (NASDAQ:SLDP) with a $3 price target, as reported by TipRanks. The analyst noted the company’s strong position in the growing all solid-state batteries (ASSBs) market, which offers advantages like longer range and improved safety for EVs.
Despite a recent dip in revenue forecasts, he believes the company’s long-term outlook remains stable. Pierce views the company’s current valuation as conservative, with expectations of significant growth as the EV market expands.
In Q2, 14 hedge funds had stakes worth $7.063 million in Solid Power (NASDAQ:SLDP). As of the second quarter, Yaupon Capital is the company’s most prominent shareholder with over 1.86 million shares worth $3.1 million.
6. Arcadium Lithium plc (NYSE:ALTM)
Short Interest as % of Shares Outstanding: 7.31%
Number of Hedge Fund Holders: 19
Arcadium Lithium plc (NYSE:ALTM) is a significant player in the lithium production industry and it was formed from the Allkem-Livent merger in January 2024. With interests in various properties across Argentina, Canada, and Western Australia, the company is well-positioned to meet the growing demand for lithium, a critical component in battery manufacturing for EVs and energy storage systems.
As a global producer of lithium chemicals, the company is involved in a range of extraction processes, including hard-rock mining, conventional brine extraction, and direct lithium extraction (DLE). It produces a variety of lithium products essential for high-performance batteries, such as battery-grade lithium hydroxide, lithium carbonate, and butyllithium. These products support multiple industries, including automotive, electronics, agriculture, and pharmaceuticals.
The company is focusing on investments to enhance production capabilities. In August, it acquired Li-Metal’s lithium metal business for $11 million. The acquisition is expected to boost the company’s production of lithium metal and specialty products, especially its butyllithium and other specialty chemicals. This move aims to create the scale needed to meet the increasing demand for next-generation battery materials derived from lithium metal.
Despite recent challenges in the lithium market, including an oversupply, Arcadium Lithium (NYSE:ALTM) has managed to maintain its performance. The company reported EPS of $0.05 and sales of $254.5 million for Q2, showing an 8% increase from the previous year.
On August 9, KeyBanc lowered the price target on the stock to $8 from $9 but maintained an Overweight rating. KeyBanc notes that the company is appropriately adjusting its capacity expansion plans and focusing on its balance sheet amid the current market downturn.
Arcadium Lithium (NYSE:ALTM) was part of 19 hedge funds’ portfolios in the second quarter with a total stake value of $51.99 million. It takes the 6th spot on our list of the best battery stocks to buy according to short sellers.
First Pacific Advisors stated the following regarding Arcadium Lithium plc (NYSE:ALTM) in its Q2 2024 investor letter:
“Arcadium Lithium plc (NYSE:ALTM) is an integrated, low-cost, well-managed lithium producer formed by the merger of Livent, which the Fund owned, and Allkem in Australia. The merger was completed at the beginning of the year and we received, and decided to hold, shares of Arcadium. The share price has declined because of volatile lithium prices that collapsed from bubbly levels at the beginning of 2023.27 Estimates for electric vehicle production are slowing and capacity got ahead of demand; the industry is now waiting for a supply response.
Arcadium is an unusual investment for us. We normally avoid the commodity and materials sectors, and have kept our position in Arcadium small. But we believe Arcadium has a unique position in an industry with a strong long-term outlook. The company has low-cost production assets, is virtually debt-free, and has considerable capacity additions planned near-term.”
5. Tesla, Inc. (NASDAQ:TSLA)
Short Interest as % of Shares Outstanding: 2.72%
Number of Hedge Fund Holders: 85
Tesla, Inc. (NASDAQ:TSLA) has firmly established itself as a major player in the EV market and renewable energy sectors. The company is known for its electric cars that use high-performance lithium-ion batteries. The company’s innovation extends beyond its vehicles, as evidenced by its Gigafactory, a key manufacturing site for its batteries. It is planning to open new facilities soon to further enhance its production capabilities.
In 2019, the company acquired Maxwell Technologies, a move that brought ultracapacitor production and advanced battery technology into its fold. Maxwell’s work on dry coating electrode technology holds the potential to significantly improve the efficiency of lithium-ion batteries.
The company’s reach extends beyond electric cars with its Energy Generation and Storage segment, which includes products like the Powerwall, Powerpack, and Megapack. These battery solutions cater to residential, commercial, and utility-scale applications, allowing users to store renewable energy for future use. This diversification puts the company forward as a producer of not only electric vehicles but also sustainable energy solutions.
According to Insider Monkey’s database, 85 hedge funds held stakes in Tesla (NASDAQ:TSLA) in the second quarter, with positions worth $5 billion. With 5.3 million shares of the company, valued at $1.05 billion, Catherine D. Wood’s ARK Investment Management is the largest shareholder of the company, as of June 30.
In 2023, Tesla (NASDAQ:TSLA) delivered over 1.8 million vehicles, which showcases its production and delivery capabilities. Favorable government policies supporting emission reductions have also played a role in the company’s growth. In the second quarter, it reported revenue of $25.5 billion, a 2% increase from the previous year. Automotive revenue saw a rise of 14% compared to the first quarter.
Despite facing challenges like higher interest rates and growing competition in the EV sector, the company managed to produce over 410,000 units and deliver 444,000 units in Q2. The company aims to scale its production to 3 million vehicles by 2025, which reflects a significant increase in capacity.
Moreover, its Cybertruck, priced at $111,000, was the top-selling vehicle in its price range in the U.S. in July, according to Kelley Blue Book. This accomplishment highlights the company’s strong market presence and its appeal among high-end consumers. With its continued innovation, expanding production capabilities, and strong sales performance, the company remains one of the most profitable and influential car manufacturers globally. It is one of our best battery stocks to buy now according to short sellers.
Baron Partners Fund stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q2 2024 investor letter:
“Tesla, Inc. (NASDAQ:TSLA) manufactures electric vehicles, related software and components, and solar and energy storage products. The stock contributed as Tesla continued to drive vehicle manufacturing costs lower, accelerate the launch of new models, and invest heavily in its lucrative AI initiatives. Shareholders reaffirmed the CEO’s compensation plan, alleviating personnel and legal uncertainties. Despite material operational complexities resulting in significant shutdowns of key manufacturing facilities and lower sales volume, Tesla presented better-than-expected margins in the quarter. It expects to launch a lower cost model as soon as late 2024, which should result in accelerated revenue growth, reduced manufacturing costs, and increased factory utilization. The company continued to advance its autonomous driving capabilities, expanding its already significant data centers and developing its humanoid robot Optimus. These investments increased confidence in the attractive growth opportunities that remain ahead.”
4. EnerSys (NYSE:ENS)
Short Interest as % of Shares Outstanding: 2.40%
Number of Hedge Fund Holders: 30
EnerSys (NYSE:ENS) is a Pennsylvania-based leading company in the battery industry due to its broad range of energy storage solutions designed for various industrial uses. The company operates through four key segments, Energy Systems, Motive Power, Specialty, and New Ventures.
In its Energy Systems segment, the company supplies uninterruptible power systems (UPS) for telecommunications and industrial sites, large-scale energy storage solutions, and integrated power systems for sectors like broadband and renewable energy.
The Motive Power segment caters to power solutions for electric industrial forklifts and automated guided vehicles. Meanwhile, the Specialty segment provides batteries for automotive, satellite, and military vehicle applications.
The New Ventures segment is focused on creating energy storage and management systems to cut demand charges and offer backup power for utilities and electric vehicles. The company has been actively expanding its market reach through key acquisitions. In July, it completed the purchase of Bren-Tronics, which betters its capabilities in defense applications and strengthens its role in the military battery sector. This acquisition supports the company’s effort to diversify its product lineup and enter rapidly growing markets.
Additionally, the company is in the midst of expanding its operations with the construction of a lithium-ion cell gigafactory in Greenville, South Carolina. The company plans to invest $500 million in this new facility. Once operational, it will produce different types of lithium-ion cells for commercial, industrial, and defense uses, and is aiming for an annual production capacity of four-gigawatt hours (GWh).
In August, EnerSys (NYSE:ENS) reported its fiscal Q1 2025 earnings. The non-GAAP EPS was $1.98, which surpassed expectations by $0.03. The company reported revenue of $853 million. David Shaffer, President and CEO, highlighted that the company achieved its earnings goals by maintaining prices and implementing careful cost reductions, while also investing in promising growth opportunities. By keeping prices stable, the company avoided compromising its pricing to attract new business, and its cost reduction measures suggest a well-thought-out plan for managing expenses.
On August 27, Roth MKM analyst Chip Moore initiated coverage of the stock with a Buy rating and a $120 price target. Moore views the company as a key player in the energy transition, well-positioned to address complex and evolving power challenges. The analyst believes that the company’s innovation in response to trends like electrification, automation, and digitization will drive its future growth. It is among our best battery stocks to buy now according to short sellers.
In the second quarter, 30 hedge funds held positions in EnerSys (NYSE:ENS) worth $430.571 million. As of Q2, AQR Capital Management is the most dominant shareholder in the company and has a position worth $94.022 million.
3. Sociedad Química y Minera de Chile S.A. (NYSE:SQM)
Short Interest as % of Shares Outstanding: 2.27%
Number of Hedge Fund Holders: 9
Sociedad Química y Minera de Chile S.A. (NYSE:SQM) is a leading Chilean company recognized globally for its production of lithium, iodine, and specialty plant nutrients. It is the world’s largest lithium producer. The company was founded in 1968 and over the years, it has expanded its operations internationally.
The company has become a key player in the global supply chain for essential minerals like lithium, which is vital for the production of batteries used in EVs and renewable energy storage. It is among our best battery stocks to buy now according to short sellers.
The company has operations in 110 countries across 5 continents. It has a unique advantage due to its exclusive access to the world’s largest and richest deposits of caliche and brine, located in the Atacama Desert between Chile’s First and Second Regions. These resources provide the company with extensive reserves of essential minerals, including the largest reserves of iodine and nitrate, along with the highest concentrations of lithium and potassium ever recorded.
Additionally, starting in 2017, Sociedad Química (NYSE:SQM) began expanding its geographic reach, particularly in lithium production. This expansion includes acquiring new lithium resources from spodumene in Western Australia through a partnership with Kidman Resources, further strengthening its global presence in the lithium market.
According to its 2023 annual report, the company continued expanding its production capacity across its main business lines. In the lithium sector, the company increased its Lithium Chemical Plant’s capacity to 200,000 metric tons of lithium carbonate by the end of 2023 and aims to reach 210,000 metric tons in 2024. It also began operations at its Mt. Holland mining and concentrator facilities and is on track to complete refining capacity in Kwinana, Perth, by 2025. Additionally, the company refurbished a lithium hydroxide plant in China and began production using lithium sulfate from the Salar de Atacama.
As of 2023, Sociedad Química (NYSE:SQM) sold lithium products to 207 customers across 39 countries, with 92% of sales going to Asia. The company’s largest customers accounted for about 67% of its revenues. In 2023, the company held an 18% market share in lithium production.
As of August 9, Goldman Sachs sees long-term potential in the company. The firm’s analyst, Marcio Farid, upgraded the stock from a Neutral to a Buy rating, while keeping the price target at $46.50 per share, as reported by The Fly. Farid believes that the potential rewards of investing in the stock outweigh the risks. The analyst noted that the company is strategically positioned to benefit from an anticipated improvement in the lithium supply and demand dynamics by 2027.
In Q2, 9 hedge funds had stakes in Sociedad Química y Minera de Chile S.A. (NYSE:SQM), at a combined value of $44.8 million. Kopernik Global Investors initiated a position with 640,997 shares, worth $26.12 million in the company and is the biggest shareholder of the company, as of June 30.
2. Ultralife Corporation (NASDAQ:ULBI)
Short Interest as % of Shares Outstanding: 1.52%
Number of Hedge Fund Holders: 11
One of the best battery stocks, Ultralife Corporation (NASDAQ:ULBI) is a New York-based company that specializes in the design and manufacture of innovative battery solutions and communication systems. The company provides products and services across various sectors, including government and defense, medical, safety and security, energy, and robotics.
The company’s operations are divided into two main segments, battery and energy products, which feature a wide range of advanced lithium-based batteries, and communications systems, which are engineered to meet the demanding requirements of military and defense applications worldwide. We last covered Ultralife (NASDAQ:ULBI) in April 2023 in our article about the best EV stocks under $10, when the stock was trading under $4. Since then, the company stock has returned nearly 165%, as of August 30.
Despite that, Ultralife (NASDAQ:ULBI) stock is still trading at a forward price-to-earnings ratio of 13.76, at a nearly 31% discount to its industry average. The company has been outperforming the analyst estimates for the last 3 quarters and is expected to grow its EPS by over 43% in 2024.
In the second quarter, the company reported an EPS of $0.22 and generated revenues of $43 million. The company is experiencing solid revenue growth, especially in its Battery & Energy Products segment, which is crucial as the demand for advanced battery solutions in defense and medical markets continues to rise. In the most recent quarter, this segment reached its highest revenue level, driven by a 30.5% increase in government defense sales and a 20.1% rise in medical market sales.
The company’s ability to generate solid cash flow also allowed it a substantial reduction in debt by over 50% by Q2, which positions Ultralife (NASDAQ:ULBI) with a stronger balance sheet and lower interest expenses moving forward. Despite the decline in sales within the Communications Systems segment due to previous supply chain disruptions, the company’s overall gross profit margin increased to 26.9%, up from 24.8% in the previous year, which shows the company’s strength in its operations and its focus on profitability.
In the second quarter, 11 hedge funds had stakes worth $6.4 million in Ultralife (NASDAQ:ULBI). As of June 30, Renaissance Technologies is the company’s largest shareholder with 242,490 shares worth $2.575 million.
1. Honeywell International Inc. (NASDAQ:HON)
Short Interest as % of Shares Outstanding: 0.89%
Number of Hedge Fund Holders: 50
Honeywell International Inc. (NASDAQ:HON) is a multinational conglomerate with a strong footing in the global market due to its broad and innovative portfolio spanning aerospace technologies, building automation, energy and sustainable solutions, and industrial automation. The company has been advancing battery technology, and its Honeywell Ionic battery energy storage system (BESS) is evidence of this focus. The system is designed to optimize energy costs while offering reliable backup power and reducing carbon emissions. Its flexibility is highlighted by its ability to support different battery chemistries and scale from around 700 kilowatt-hours (kWh) to 300 megawatt-hours (MWh).
In the EV sector, the company has made significant strides with its battery safety sensors. These sensors are essential for the early detection of thermal runaway, a critical safety feature for EVs and energy storage systems. The company’s current sensors, including the CSNV, CSHV, and CSSV series, provide accurate battery state measurements and adhere to international safety standards. Furthermore, the BAS Series and BPS Series offer advanced detection capabilities for thermal runaway and particulate matter within battery packs, which improves overall safety and dependability.
Its investment in the battery technology sector is also significant. The company’s $27.5 million investment in ESS Tech signals its dedication to advancing long-duration battery storage solutions. This investment aligns with the company’s broader goal of supporting sustainable energy technologies and expanding its footprint in the battery market. It tops our list of the best battery stocks to buy now.
In the second quarter, 50 hedge funds had stakes in Honeywell International (NASDAQ:HON), with total positions worth $1.08 billion. Millennium Management has increased its stake in the company by 179% to 1.6 million shares worth $351.117 million and is the most significant shareholder, as of the second quarter.
Honeywell International’s (NASDAQ:HON) diverse business segments contribute to its steady growth, regardless of market fluctuations. In the second quarter, it reported a 5% increase in sales, reaching $9.6 billion. Its non-GAAP adjusted EPS was $2.49. The Aerospace Technologies segment saw a 16% rise in revenue compared to the previous year, driven by increased flight hours, higher chipset deliveries, and improved supply chain conditions.
Similarly, the Building Automation segment’s revenue grew by 4% year-over-year, due to strong performance in data centers, healthcare, and energy services. The Energy and Sustainability Solutions segment also saw a 2% revenue increase, supported by strong demand for fluorine products in Advanced Materials.
Additionally, the company’s growth trajectory is supported by its strategic acquisitions, such as CAES Systems and Air Products’ liquefied natural gas process technology and equipment business, which were announced in June and July, respectively. These acquisitions are expected to strengthen the company’s capabilities and market position further.
While we acknowledge the potential of Honeywell International Inc. (NASDAQ:HON) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than the ones mentioned on our list but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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