In this article, we discuss the 11 most promising EV battery stocks according to analysts, along with the challenges and breakthroughs in the EV battery industry.
Despite the electric vehicle industry growing at a fast pace, some challenges remain. The major ones are range anxiety among consumers, slow battery charging time, and the availability of charging infrastructure. However, even with these challenges, the industry remains healthy and a lot of energy and resources are being contributed toward it.
The infrastructure market is expected to grow at a phenomenal pace as PwC expects the EV supply equipment (EVSE) market to grow from $7 billion to $100 billion by 2040, at a 15% compound annual growth rate.
For electric vehicle components, governments around the world are incentivizing EV production. For example, the U.S. Department of Energy (DOE) recently announced $1.7 billion in funding to transition 11 vulnerable auto manufacturing plants across eight states to EV production and related components. For more details, you can read 8 Best EV Stocks to Buy According to Short Sellers.
Advancements in EV Battery Technology
Due to the environmental impacts of internal combustion engines, scientists have also been working tirelessly to solve the current problems faced by EV batteries. Researchers, led by the University of Colorado Boulder, have uncovered the cause of battery degradation, a common issue that leads to reduced capacity over time. Their study, published in Science.org, may pave the way for improved lithium-ion batteries, which are crucial for EVs and energy storage.
Using advanced X-ray technology, they discovered that hydrogen molecules from the battery’s electrolyte bind to the cathode, taking spots meant for lithium ions, which weaken the battery’s performance. This new understanding could help engineers develop longer-lasting, cobalt-free batteries for EVs, which would increase driving range, reduce costs, and address environmental and ethical concerns related to cobalt mining.
Additionally, according to a research report published in Frontiers in Quantum Science and Technology, Yuji Hatano and his team explored the impact of transverse magnetic fields on diamond quantum sensors for EV battery monitoring. Their research aimed to improve measurement accuracy for temperature and magnetic fields, which are crucial for determining the state of charge (SOC).
The study showed that diamond sensors enhance SOC estimation, which could potentially increase the EV cruising range by 10%. A prototype demonstrated high precision with currents up to 1,000 amperes, and misalignment detection was highly accurate. The findings suggest diamond quantum sensors could significantly improve battery monitoring in EVs and other industries.
Moreover, solid-state batteries could also reduce the charging time in batteries which could drastically improve the consumer sentiment and increase the demand for EVs. It was suggested by Mark Fields, former Ford CEO and President on CNBC’s ‘Squawk Box’ and we discussed it in our article on the best EV stocks for the long term. Here is an excerpt from the article:
“Fields suggested that automakers need to offer more affordable EVs and expand hybrid offerings while working towards breakthroughs in battery technology, especially solid-state batteries. These batteries could eventually reduce charging times to match the convenience of filling up at a gas station…
…He emphasized that while automakers are working on delivering low-cost EVs, the real game-changer will be the development of solid-state batteries, which could significantly improve charging times and consumer convenience.”
With that, we look at the 11 Most Promising EV Battery Stocks According to Analysts.
11 Most Promising EV Battery Stocks According to Analysts
Our Methodology
For this article, we identified over 20 EV battery stocks through screeners and ETFs. We narrowed our list to 11 stocks with the highest average analyst price target upside, as of September 12. We also added the hedge fund sentiment around each stock which was taken from Insider Monkey’s database of over 900 hedge funds as of the second quarter of 2024.
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).
11 Most Promising EV Battery Stocks According to Analysts
11. NIO Inc. (NYSE:NIO)
Average Analyst Price Target Upside as of September 12: 19.52%
Number of Hedge Fund Holders: 20
NIO Inc. (NYSE:NIO), a leading Chinese EV manufacturer, is making waves in the EV market with its innovative battery technologies and unique approaches to energy storage. The company’s latest advancement is its 150 kWh semi-solid-state battery, introduced in July 2023.
The new battery pack significantly extends the driving range of NIO’s vehicles, reaching around 930 kilometers (578 miles) on a single charge. The range surpasses many traditional lithium-ion batteries, which shows that the company is pushing the boundaries of EV performance.
The semi-solid-state battery technology represents a significant leap forward for the company. By integrating the benefits of solid-state technology with the practicality of current lithium-ion batteries, it has created a product that offers both high energy density and practicality. The advancement not only improves the range of NIO’s vehicles but also allows current NIO owners to upgrade to the new battery packs, a move that adds value and longevity to their existing EVs.
The company is also working on other cutting-edge battery technologies, such as 4680 battery cells and lithium manganese iron phosphate (LMFP) batteries. The developments aim to further improve energy density and vehicle performance, which improve th company’s position as an innovator in the EV space.
NIO (NYSE:NIO) has a consensus Buy rating as per the coverage of 37 analysts. As of September 12, the average price target of $6.31 implies an upside of 19.52% from the present levels. It is among our most promising EV battery stocks according to analysts.
In Q2, NIO (NYSE:NIO) showcased remarkable growth, with revenue increasing by 99% year-over-year to 17.45 billion yuan ($2.4 billion). The company set a new record by delivering 57,373 EVs during the quarter and projects deliveries of between 61,000 and 63,000 vehicles for the third quarter. The impressive performance highlights its strong market presence and growing customer base.
On September 5, JPMorgan upgraded the stock to Overweight from Neutral with a price target of $8, up from $5.30. The upgrade is based on improved visibility into the company’s plans and the company’s significant progress in strengthening its cash position. JPMorgan anticipates that the company’s operating cash flow will turn positive in the second half of 2024, which will reduce concerns about future fundraising or equity dilution.
In the second quarter, 20 hedge funds had stakes in NIO (NYSE:NIO), with total positions worth $82.117 million. As of June 30, Point72 Asset Management is the most significant shareholder in the company with a stake worth $26.89 million.
10. EnerSys (NYSE:ENS)
Average Analyst Price Target Upside as of September 12: 22.45%
Number of Hedge Fund Holders: 30
One of the most promising EV battery stocks, EnerSys (NYSE:ENS) has been adding to its portfolio to cater to the rising demand for EV batteries and other energy storage solutions. A key development came in June 2021 with the introduction of the NexSys iON battery.
The battery integrates cutting-edge lithium-ion technology with a modular design, which improves both performance and adaptability. Utilizing Nickel Manganese Cobalt (NMC) large format prismatic cell chemistry, the NexSys iON battery offers high energy capacity while maintaining a compact size, which makes it an ideal solution for heavy-duty applications.
The NexSys iON batteries are engineered for industrial uses, including electric forklifts and other heavy-duty electric vehicles. The batteries are designed to be nearly maintenance-free and feature an integrated Battery Management System (BMS) that enhances their safety and reliability.
In Q2, 30 hedge funds had investments in EnerSys (NYSE:ENS), with positions worth $430.571 million. AQR Capital Management is the top investor in the company as of Q2. In the quarter, the firm increased its stake by 18% to 908,253 shares worth $94.022 million.
EnerSys (NYSE:ENS) is also actively expanding its presence in the EV battery market through strategic collaborations. In June 2023, the company signed a non-binding memorandum of understanding with Verkor, a French battery manufacturer. The partnership is aimed at developing a battery supply chain strategy in the U.S.
Further strengthening its position, the company announced plans in February for a major expansion with a $500 million investment in a new lithium-ion cell gigafactory in Greenville, South Carolina. Expected to start production by late 2027, the facility will manufacture various types of lithium-ion cells for commercial, industrial, and defense applications, with a targeted annual production capacity of four gigawatt-hours.
The new plant is expected to generate around 500 jobs and shows that the company is focused on significantly scaling up its production capabilities to meet the increasing demand for EV batteries and other energy storage solutions.
7 analysts have covered EnerSys (NYSE:ENS) and the average price target of $120.00 implies an upside of 22.45% from the present levels, as of September 12.
9. Rio Tinto Group (NYSE:RIO)
Average Analyst Price Target Upside as of September 12: 27.18%
Number of Hedge Fund Holders: 29
Rio Tinto Group (NYSE:RIO) is a British-Australian multinational corporation, which is recognized as one of the largest mining and metals companies globally. The company continues to be a leading force in the global mining industry, contributing to various sectors, including copper, aluminum, diamonds, and most recently, lithium projects. It is our 9th most promising EV battery stock according to analysts.
Rio Tinto (NYSE:RIO) is strategically investing in its lithium capabilities by developing its own projects, especially the Rincon lithium project in Argentina, which includes a planned battery-grade lithium carbonate plant. In Serbia, the company is working to develop the Jadar lithium project, which has the potential to fulfill a substantial portion of Europe’s lithium demand.
On August 29, Bloomberg reported that Rio Tinto (NYSE:RIO) is one of the companies that have been shortlisted to develop lithium assets in Chile’s Altoandinos project. The initiative, announced by state-owned Enami, is part of a broader strategy under Chilean President Gabriel Boric to expand lithium extraction and boost output.
The Altoandinos project consists of three undeveloped salt flats, which are projected to produce 20,000 metric tons of lithium by 2032, with output expected to triple by 2037. Enami plans to finalize partner selections by March and is currently negotiating terms with the listed companies.
Apart from lithium, Rio Tinto (NYSE:RIO) is also a major producer of copper which is a key component of batteries. In the first half of the year, the company mined approximately 327 kilotonnes (kt) of copper and is on track to mine 660 to 720 kt in 2024.
Rio Tinto projects a 2% growth in copper equivalent production for the year and aims for a 3% annual increase from 2024 to 2028 through its ongoing and upcoming projects. The company expects to see more cash flow from the Oyu Tolgoi underground copper mine and additional benefits from their investments in the Simandou project and the Rincon lithium project. The Oyu Tolgoi mine has increased its copper production by 15% compared to H1 2023 and is on track to produce 500,000 tonnes of copper annually from 2028 to 2036.
9 analysts have covered Rio Tinto (NYSE:RIO) stock with an average price target of $78.75. The price target represents an upside of 27.18% to the company’s stock from September 12 levels.
In the second quarter, 29 hedge funds held positions in the company, at a combined value of nearly $1.3 billion. As of June 30, Fisher Asset Management is its largest shareholder with 17.04 million shares, worth $1.12 billion.
8. Sociedad Química y Minera de Chile S.A. (NYSE:SQM)
Average Analyst Price Target Upside as of September 12: 9
Number of Hedge Fund Holders: 43.79%
One of the most promising EV battery stocks, Sociedad Química y Minera de Chile S.A. (NYSE:SQM) is a major player in the global mining and chemical industries and is based in Chile. It was founded in 1968, and the company has developed into one of the world’s largest producers of lithium, iodine, and specialty plant nutrients.
It holds strategic access to vast mineral reserves in Chile’s Atacama Desert, including some of the highest concentrations of lithium globally. The resources support its leading role in the supply chain for critical minerals used in EVs, renewable energy storage, and other industries. With a presence in over 100 countries, SQM has steadily expanded its operations and is positioned as a noteworthy supplier in the transition to a greener economy.
The company’s dominant position in the lithium market, which is supported by its access to world-class mineral reserves, offers a strong growth trajectory, especially as demand for electric vehicles and energy storage solutions continues to grow. The company’s strategic expansion efforts, such as increasing lithium production capacity and investing in global partnerships, show its ability to capitalize on the rapidly growing lithium demand.
Additionally, its diversified portfolio, which includes iodine and plant nutrients, adds resilience to its business model. As global industries shift toward renewable energy and electric vehicles, SQM is well-positioned to benefit from rising market demand and its strong foothold in lithium production.
Moreover, the median price target for the stock among 17 analysts is $55, which represents an upside of 43.79% from current levels, as of September 12.
In Q2, Sociedad Química y Minera de Chile S.A. (NYSE:SQM) stock was held by 9 hedge funds, valued at $44.8 million. Kopernik Global Investors is the biggest shareholder of the company, as of June 30, after it initiated a position with 640,997 shares, worth $26.12 million in the quarter.
7. MP Materials Corp. (NYSE:MP)
Average Analyst Price Target Upside as of September 12: 45.14%
Number of Hedge Fund Holders: 28
One of the most promising EV battery stocks, MP Materials Corp. (NYSE:MP) has established itself as a key player in the rare earth materials sector with its operations centered on the Mountain Pass mine in California. The company plays an essential role in supplying materials crucial for the EV industry and EV batteries, specifically neodymium and praseodymium oxides.
The elements are vital for creating permanent magnets used in EV traction motors, which are essential for enhancing the efficiency and performance of electric vehicles. In the third quarter of 2023, the company began producing these critical oxides at its Mountain Pass facility. The development is a major step in re-establishing a reliable domestic supply chain for rare earth materials in North America.
The company’s efforts to expand its operations are further supported by an important agreement with General Motors. Announced in December 2021, the long-term supply contract states that GM will receive rare earth materials and magnets sourced and manufactured in the U.S., which is in line with GM’s goal of securing a stable supply chain for its EVs.
MP Materials (NYSE:MP) is also expanding its operations with a new facility in Fort Worth, Texas. The company has commenced production of commercial precursor materials there and plans to manufacture finished magnets by late 2025. The expansion is aimed at enhancing its capacity to meet the rising demand for EV components.
Furthermore, in April, the company received a $58.5 million award from the U.S. Internal Revenue Service and Treasury to support the construction of this facility, which will be the first in the country to produce fully integrated rare earth magnets. General Motors will be a primary customer for the finished products, which will contribute to GM’s North American EV production.
In addition to its production expansion, MP Materials (NYSE:MP) has been refining its rare earths with promising results. In the second quarter, the company produced 272 metric tons of neodymium and praseodymium, with 136 metric tons sold. The company expects production of these rare earths to increase by 50% in the third quarter, driven by a new automotive customer’s demand for these materials in their magnets.
Moreover, the company has demonstrated confidence in its future by approving a significant increase to its share repurchase program. In September, it authorized an additional $300 million for share repurchases, bringing the total to $600 million. The program, which is extended until August 2026, shows the company’s commitment to returning value to shareholders, having already repurchased around 8.6% of its shares for $225.1 million in 2024.
MP Materials (NYSE:MP) has received a consensus Buy rating as per the coverage of 12 analysts. The average price target of $20 implies an upside of 45.14% to the stock’s current price, as of September 12.
At a stake value of $163.044 million, 28 hedge funds held positions in MP Materials (NYSE:MP) in the second quarter. As of Q2, QVT Financial is the top shareholder in the company and has a position worth $44.48 million.
Bernzott Capital Advisors stated the following regarding MP Materials Corp. (NYSE:MP) in its first quarter 2024 investor letter:
“Materials were the leading detractors to performance. Our exposure to MP Materials Corp. (NYSE:MP) was the main culprit, as the stock declined by 28% as prices for their critical commodity output NdPr exhibited weakness due to seasonality factors and lower demand from Electric Vehicles and other industrial applications. Despite the sell-off, we increased our position in the stock as we believe the long-term fundamentals remain intact.”
6. Arcadium Lithium plc (NYSE:ALTM)
Average Analyst Price Target Upside as of September 12: 67%
Number of Hedge Fund Holders: 19
Arcadium Lithium plc (NYSE:ALTM) is one of the leading companies in the lithium production sector. It was created through the merger of Allkem and Livent in January 2024. The company operates across major lithium-rich regions, including Argentina, Canada, and Western Australia. With its diversified global presence, the company is well-positioned to cater to the growing demand for lithium.
The stock was held by 19 hedge funds, at a combined value of nearly $52 million in Q2. It is one of the most promising EV battery stocks.
Arcadium Lithium’s (NYSE:ALTM) strategic operations in high-potential regions, combined with its use of diverse extraction methods such as hard-rock mining, brine extraction, and direct lithium extraction, strengthen its ability to supply critical lithium products. These include lithium hydroxide and lithium carbonate, both essential for high-performance batteries.
The company’s recent acquisition of Li-Metal’s lithium metal business supports its focus on expanding production capacity to meet the increasing demand for next-generation battery materials.
In the second quarter, Arcadium Lithium (NYSE:ALTM) realized an average pricing of $17,200 per metric ton for lithium hydroxide and carbonate, with its specialty products, such as butyllithium, fetching even higher prices. The company continues to expand its production capacity, expecting a 25% increase in combined lithium hydroxide and carbonate sales volume for both 2024 and 2025.
Cost-saving initiatives also remain an important point for Arcadium (NYSE:ALTM), as mentioned by the company management during the second quarter earnings call. Integration efforts across legacy businesses are expected to yield cost savings at the high end of the $60 million to $80 million guidance range in 2024.
Additionally, it aims to accelerate its $125 million per annum cost synergy target, previously set for 2027. By slowing down investment in four current expansion projects, the company is adjusting its capital deployment to align with market demand while reducing financial commitments by $500 million over the next 24 months. The decision keeps options open for the future growth of the company without stretching resources too thin during a time of low market prices.
Arcadium Lithium (NYSE:ALTM) has been covered by 27 analysts with a consensus moderate Buy rating. Their average price target is $4.13, which has a 67% upside to the company’s stock at current levels on September 12. The latest Buy ratings come from Kaan Peker from RBC Capital with a $3.60 price target and TD Cowen analyst David Deckelbaum with a price target of $6.00. Both of the analysts last covered the stock on September 5.
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. Lithium Americas Corp. (NYSE:LAC)
Average Analyst Price Target Upside as of September 12: 87.97%
Number of Hedge Fund Holders: 13
Lithium Americas Corp. (NYSE:LAC) is a lithium exploration and development company, with projects in both the United States and Canada. Its flagship initiative, the Thacker Pass project, is located in the McDermitt Caldera. It is recognized as the site of the world’s largest known lithium deposit. It ranks at 5 on our list of most promising EV battery stocks according to analysts.
As a company poised to become a key player in the global lithium market, Lithium Americas (NYSE:LAC) is strategically positioned to benefit from the surging demand for lithium, driven by the EV revolution and advancements in renewable energy storage.
The Thacker Pass project represents the most promising growth catalyst for the company. It reflects its strategic significance in the lithium supply chain. It is backed by a substantial $2.26 billion loan from the U.S. Department of Energy, which shows the national importance of securing domestic lithium supplies.
Additionally, General Motors has secured exclusive rights to Phase 1 production, which further validates the long-term potential of Thacker Pass. Once operational, the initial phase is projected to produce enough lithium annually to power 800,000 EVs, which marks a significant role for the company in the global transition to clean energy. Despite recent fluctuations in lithium prices, the long-term outlook for rising demand along with the company’s strategic positioning show a compelling case for growth.
On October 3, 2023, Lithium Americas underwent a corporate reorganization, splitting into two distinct publicly traded entities. The separation resulted in the creation of Lithium Americas (Argentina) Corp., also known as Lithium Argentina, which trades on the TSX and NYSE under the symbol “LAAC.” The remaining company, which retained the original name Lithium Americas Corp., trades under “LAC” on both the TSX and NYSE.
The stock is covered by 14 analysts with an average price target of $4.63, which implies an upside of 87.97% from the September 12 levels. On the other hand, Lithium Americas (Argentina) (NYSE:LAAC) has been covered by 13 analyst with a median price target of $5.00, which represents an upside of 93.05%.
While the Thacker Pass is Lithium Americas’ (NYSE:LAC) flagship project, Lithium Americas (Argentina) (NYSE:LAAC) holds interests in several projects, including the Cauchari-Olaroz project in Jujuy Province, Argentina, a development and exploration portfolio in Salta Province, and full ownership of the Antofalla Project in Catamarca Province.
As of the second quarter, 13 hedge funds had stakes worth nearly $32 million in Lithium Americas (NYSE:LAC) and 8 hedge funds had stakes worth $4.005 million in LAAC.
Massif Capital Real Assets Strategy stated the following regarding Lithium Americas Corp. (NYSE:LAC) in its Q2 2024 investor letter:
“Lithium Americas Corp. (NYSE:LAC): No Massif Capital letter would be complete without examining something that is not working or that we got wrong. Thus far this year, the clear winner is our expectation that lithium would make a rebound. Lithium prices have continued to sell off, with lithium hydroxide and carbonate in China down ~10% since the start of the year and the lithium mining sector, as measured by the Global X Lithium ETF, down 18%. The fund’s two lithium investments, Lithium Americas Corp. (NYSE:LAC) and Lithium Argentina, are down 48% and 46%, respectively.
While the story with Lithium Americas, a development company focused on building an exceptionally large lithium asset in Nevada, is complicated, the story with Lithium Argentina is similar to the situation in Siemens Energy last year. The market tossed the baby out with the bath water. The firm’s Cauchari asset in Argentina is a bottom-cost quartile brine asset that is fully built, went into operation last year and continues ramping to full commercial production on schedule. At a 10% discount rate and $12,000 per ton lithium in perpetuity, we still think the firm’s 44% ownership stake in the mine is worth $6 a share, 82% above the current price. At $18,000 per ton, the mine is worth more than $15 a share to the company. The operating leverage to the lithium price is fantastic…” (Click here to read the full text)
4. Enovix Corporation (NASDAQ:ENVX)
Average Analyst Price Target Upside as of September 12: 114.13%
Number of Hedge Fund Holders: 22
Enovix Corporation (NASDAQ:ENVX) is a California-based company that has made significant strides in the field of advanced battery technology with its unique 3D Silicon cell design. The breakthrough approach features a silicon anode that is entirely active, a major upgrade from conventional lithium-ion batteries.
As a result, the new batteries offer a remarkable boost in energy density and lifespan, which makes them highly attractive for applications demanding extended battery life and higher performance. Additionally, the stock has a consensus Strong Buy rating among 12 analysts, and its average price target of $20.00 represents an upside of 114.13% from current levels, as of September 12.
Enovix (NASDAQ:ENVX) was part of 22 funds’ portfolios and the total stake value was $153.245 million in the second quarter. As of June 30, Electron Capital Partners is the largest shareholder in the company and has a position worth $89.7 million.
In July 2022, Enovix (NASDAQ:ENVX) took a major step forward by delivering its first battery packs. The packs incorporate their high-energy silicon anode cells along with sophisticated electronic control systems.
The development means that the company is now able to offer battery solutions that provide enhanced power for devices that consume more energy. The shift from single-cell offerings to full battery packs opens up new opportunities in various consumer electronics and other energy-intensive applications.
In the second quarter, the company reported a non-GAAP EPS of -$0.14, which beat expectations by $0.09. The company also achieved revenues of $3.8 million, which exceeded forecasts by $0.15 million. The revenues showed a significant increase from the $42,000 reported in the same quarter of the previous year.
The company has a robust financial position that supports its ongoing projects and growth as it ended the quarter with around $250 million in cash and equivalents. For the third quarter, the company has projected revenues between $3.5 to $4.5 million, which shows continued progress and expansion in its market presence. It ranks 4th on our list of the most promising EV battery stocks according to analysts.
Massif Capital Real Assets Strategy stated the following regarding Enovix Corporation (NASDAQ:ENVX) in its Q2 2024 investor letter:
“Enovix Corporation (NASDAQ:ENVX): Enovix is perhaps a bit of an outlier in our portfolio given that it is a battery manufacturer selling into consumer goods markets, but it fits nicely in what we believe to be the Massif Capital analytical sweet spot, businesses where science/technology, geopolitics/geoeconomics and energy/materials overlap. While some would argue that Enovix is inappropriate for a liquid real asset portfolio, the traditional definition of real asset businesses is dated.
Traditionally, real asset businesses are those that own and operate real estate, infrastructure, and natural resource assets. While this definition is workable, and most of the companies we invest in fall into one of these categories, it does not consider the ever-growing role of applied physical sciences in specific manufacturing fields, nor does it take into account the growing importance of material sciences and the changing nature of energy in general. Enovix is a material sciences business aiming to transform an ever-growing list of unique, highly refined materials into energy storage devices. They create value by understanding materials’ physical and electrochemical properties better than others…” (Click here to read the full text)
3. Sigma Lithium Corporation (NASDAQ:SGML)
Average Analyst Price Target Upside as of September 12: 115.55%
Number of Hedge Fund Holders: 20
Sigma Lithium Corporation (NASDAQ:SGML) is a major player in the lithium industry, primarily focused on developing lithium resources in Brazil. It owns several properties in Minas Gerais, spanning around 185 square kilometers. The company has integrated strong ESG principles, achieving Net Zero in 2023, and focuses on environmental protection and community engagement. It is one of the most promising EV battery stocks to buy.
In the second quarter, the company strengthened its market position by increasing sales volumes and achieving prices 10% higher than its competitors. Sigma Lithium (NASDAQ:SGML) achieved notable operational and financial success in Q2, even with tough conditions in the lithium market.
The company ramped up its production to 22,000 tonnes every 30 to 35 days during the quarter, which proved its reliability as a supplier. The consistent performance helped the company secure favorable credit terms linked to exports. By being assertive in its sales approach, it was able to charge the higher prices discussed above, which shows its strong market position.
For the future, Sigma Lithium’s (NASDAQ:SGML) management discussed its strategic plan to expand production capacity to 100,000 tonnes of lithium carbonate equivalent (LCE) by 2026, at its latest earnings call. The company is executing this growth through a disciplined approach, focusing on one production line at a time.
The company plans to produce about 80,000 tonnes of LCE, or 520,000 tonnes of lithium concentrate, by next year. After reaching this goal, it will start building a third production line with a capacity of 250,000 tonnes of LCE.
In the second quarter, Sigma Lithium’s (NASDAQ:SGML) shares were held by 20 hedge funds with positions worth $89.137 million. Appian Way Asset Management is the company’s most significant shareholder with 2.6 million shares, worth $31.3 million, as of Q2.
Analysts are also quite bullish on the company as all four analysts that have covered the stock recently maintain a Buy-equivalent rating on the stock. The median price target of $22.03 shows an upside of 115.55% to the company’s stock price as of September 12.
2. Solid Power, Inc. (NASDAQ:SLDP)
Average Analyst Price Target Upside as of September 12: 130.77%
Number of Hedge Fund Holders: 14
Solid Power, Inc. (NASDAQ:SLDP) is a Colorado-based company specializing in solid-state battery technology, especially for EVs and other sectors. The company is known for its sulfide-based solid electrolytes and licenses its proprietary cell designs and production methods. Its technology enhances safety and boosts energy density by 50-75% compared to conventional batteries, making it a competitive option for EVs, electronics, and aerospace.
Solid Power (NASDAQ:SLDP) produces solid-state battery cells and manufactures sulfide solid electrolytes, partnering with major automakers. It has established pilot production lines to improve cell designs and collaborated with companies like SK On, Ford, and BMW. The management remains optimistic and is focusing on expanding electrolyte production, enhancing cell design, and strengthening industry partnerships. Recent developments include increased electrolyte shipments and enhancements in their A-2 cell design.
Analysts have mixed sentiments around Solid Power (NASDAQ:SLDP) stock but the average price target of $3.00 among 5 analysts represents an upside of 130.77% from the current levels on September 12.
As reported by TipRanks on August 7, Needham analyst Chris Pierce has reiterated his Buy rating for the stock, with a price target of $3.00. Pierce is optimistic about the company’s future in the growing all-solid-state batteries market, which offers advantages such as increased range and safety for electric vehicles. Although there has been a recent reduction in revenue forecasts, Pierce believes the company’s long-term outlook remains solid, as short-term EV adoption fluctuations do not heavily impact it.
The analyst considers the stock’s current valuation to be conservative, estimating that by 2030, electric vehicles will make up 35% of the market, with solid-state batteries capturing 4% of that. His price target is based on the company’s expected adjusted earnings for 2030, multiplied by five, which he sees as reflecting the company’s strong growth potential in the EV and battery markets.
In the second quarter, 14 hedge funds held positions worth $7.063 million in the company. Yaupon Capital holds over 1.8 million shares of Solid Power (NASDAQ:SLDP), worth nearly $3.1 million, making it the company’s most prominent shareholder, as of June 30.
1. Piedmont Lithium Inc. (NASDAQ:PLL)
Average Analyst Price Target Upside as of September 12: 175.86%
Number of Hedge Fund Holders: 9
Piedmont Lithium Inc. (NASDAQ:PLL) is well-known in the lithium market, specifically targeting the growing EV battery sector. The company’s Carolina Lithium Project spans approximately 3,706 acres in North Carolina’s Carolina Tin-Spodumene Belt. The region, located northwest of Charlotte, is crucial for its spodumene ore, a primary source of lithium.
In addition to this major project, it also owns properties in Bessemer City and Kings Mountain, North Carolina, which advance its development efforts. Aiming to capitalize on the growing demand for EVs, the company is focused on lithium hydroxide production. The compound is important for the lithium-ion batteries that power EVs.
In addition to its North Carolina projects, the company is advancing its lithium endeavors in Quebec. The North American Lithium project is known for being the largest spodumene mine in North America, which will be instrumental in meeting the increasing battery market needs. The company aims to produce around 60,000 metric tons of lithium hydroxide annually from these operations, contributing significantly to the U.S. lithium supply.
The company’s vision is to become a top lithium producer in North America and respond to the need for a more localized supply chain. Its goal is to produce 30,000 metric tons of lithium hydroxide annually from its Carolina Lithium Project, which will be a comprehensive operation converting spodumene ore into lithium hydroxide.
In 2022, Piedmont Lithium (NASDAQ:PLL) secured an important supply contract with Tesla, agreeing to supply spodumene concentrate through 2025. The agreement was adjusted in 2023 to include a floating price mechanism, which allows for more adaptability in pricing. Under the updated terms, the company will deliver 125,000 tonnes of spodumene concentrate, sourced from Sayona Mining’s North American Lithium project in Quebec, Canada.
The company is also forging strong partnerships to fuel its expansion. A significant development occurred in April 2023 when LG Chem, a prominent battery manufacturer, made a $75 million equity investment in Piedmont Lithium (NASDAQ:PLL).
The deal not only provides significant capital but also involves LG Chem committing to purchase 200,000 metric tons of spodumene concentrate over four years. The partnership is in line with the growing demand for battery materials in North America, supported by incentives for domestic production through the Inflation Reduction Act.
On August 12, B. Riley analyst Matthew Key lowered the price target on the stock to $20 from $26 and kept a Buy rating after the Q2 report. The revision reflects the company’s decision to consolidate its operations, moving the proposed Tennessee Lithium capacity to Carolina Lithium.
As per the analyst, the shift is expected to enhance economic efficiency and technical performance, making the North Carolina project more economically viable due to its integrated nature. The strategic move positions the company for continued growth and success in the expanding lithium market.
The stock has received a consensus Buy rating from 10 analysts. As of September 12, the average price target of $20 has an upside of 175.86% from the current levels. It takes the top spot on our list of the most promising EV battery stocks according to analysts.
In the second quarter, 9 hedge funds had stakes in Piedmont Lithium (NASDAQ:PLL), with total positions worth $9.559 million.
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