In this article, we discuss the 8 best EV stocks to buy right now along with the latest updates around the industry.
After a swift rise in the EV industry over the years, we saw a slowdown in its progress, especially in Europe and the USA. Nevertheless, it is just a matter of time before the technology takes over the traditional internal combustion engines (ICE).
While the growth has been slowing in the western part of the world, China has been working tirelessly to become the global leader in the EV industry. In a podcast episode of Everything Electric Show on October 20, Ford CEO Jim Farley discussed the ongoing transformation in the automotive industry.
He noted that while EV adoption continues to grow worldwide, significant changes have occurred regarding market dynamics. He emphasized China’s dominance in EV production, with 70% of global EVs manufactured there. A rapidly expanding sub-segment in China is electric vehicles with extended range (e-rev), which use a small combustion engine to power the batteries for longer trips.
This shift is reshaping global supply chains, brand preferences, and jobs, with geopolitical factors further influencing the industry’s future. Farley noted that these changes have become clearer over the past year.
We also discussed the country’s dominance in our article about small-cap EV stocks to invest in. Here is an excerpt from the article:
“While the growth in the US and Europe is slowing down, China is picking up a significant pace and dominating the EV landscape. According to a World Economic Forum report, Chinese EVs are much cheaper than their Western counterparts, with an average price of $34,400, compared to $55,242 in the U.S. The price gap is driven by lower labor costs, favorable government subsidies, and more affordable battery sourcing.
Chinese automakers now produce more than half of the world’s EVs and are using their cost advantages to potentially dominate the global market. As Chinese brands gain scale and expertise, their competitive pricing could allow them to challenge Western automakers.”
Read Also: 7 Best Delivery Stocks To Invest In Now and 10 High Growth Non-Tech Stocks That Are Profitable in 2024.
US Racing Against China’s Dominance
The United States government acknowledges the potential of EVs in the future of mobility and is trying its best to push for its development. On July 11, the Department of Energy (DOE) announced $1.7 billion in grants aimed at converting 11 auto plants in eight states to produce electric vehicles and components.
Reuters reported on October 22 that U.S. Energy Secretary Jennifer Granholm announced that the DOE is working quickly to finalize $1.7 billion in grants. The funds include $500 million for GM’s Michigan plant and $334.8 million for Stellantis’ Belvidere plant, with additional funds for the latter’s Indiana facility.
According to another Reuters report from September 23, Monroe Capital LLC announced plans to launch the Drive Forward Fund LP, aiming to raise up to $1 billion to provide loans to smaller auto suppliers transitioning from internal combustion engine vehicles to EVs.
The White House supports this initiative, emphasizing that it will offer affordable capital to help small and medium-sized auto manufacturers refinance, grow, and diversify and will benefit over 250,000 workers.
Moreover, new U.S. tariffs on Chinese EVs and stricter emissions regulations are pushing automakers to adapt their supply chains. Monroe CEO Ted Koenig highlighted the fund’s importance in cultivating growth and innovation among suppliers struggling to secure financing for EV production.
With that, we look at the 8 Best EV Stocks To Buy Right Now.
8 Best EV Stocks To Buy Right Now
Our Methodology
For this article, we identified over 30 EV manufacturers using the Finviz stocks screener and narrowed our list to 8 stocks most widely held by institutional investors. The stocks are listed in ascending order of their hedge funds which was taken from Insider Monkey’s Q2 database of 912 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).
8 Best EV Stocks To Buy Right Now
8. Li Auto Inc. (NASDAQ:LI)
Number of Hedge Funds Holders: 17
Li Auto Inc. (NASDAQ:LI) is a prominent player in China’s new energy vehicle market, focusing on the design, development, and manufacturing of premium smart EVs. Since it began volume production in late 2019, the company has expanded its offerings to include advanced models like the Li MEGA MPV and flagship SUVs such as the Li L9, Li L8, and Li L7. It is one of the best EV stocks to buy.
The company is also a significant player in the charging infrastructure as it operates nearly 894 supercharging stations in operation, featuring 4,286 charging stalls in China. As of September 30, it operated 479 retail stores across 145 cities, along with 436 service centers and authorized body and paint shops in 221 cities.
In collaboration with the China National Petroleum Corporation (CNPC), Li Auto (NASDAQ:LI) plans to add over 2,000 charging stations and 10,000 charging columns at CNPC locations. By the end of 2024, this expansion will enable the company to reach over 90% coverage in major city centers and more than 70% along national routes.
Li Auto (NASDAQ:LI) aims to establish over 3,000 supercharging stations by 2025, which ensures comprehensive coverage of 90% along major highways and key urban areas in tier-four cities and developed regions across mainland China. The company plans to invest approximately RMB 10 billion (RMB 1= US$0.14) into this new network, which will incorporate advanced 5C charging technology, capable of delivering five full charges within an hour.
In September, Li Auto (NASDAQ:LI) delivered 53,709 vehicles, representing a 48.9% year-over-year increase. This brought the total deliveries for the third quarter to 152,831, a rise of 45.4% compared to the previous year. By the end of September, the company had delivered 341,812 vehicles for the year, contributing to cumulative deliveries of 975,176.
Xiang Li, the chairman and CEO, highlighted that with the penetration rate of new energy vehicles exceeding 50%, the leading brands have solidified their market presence.
The company captured over 17% of the NEV market for vehicles priced at RMB 200,000 and above, making it the top Chinese automotive brand in this segment. The demand for the Li L series and Li MEGA has steadily increased, which led to record deliveries in September. In October, the company is on track to achieve a significant milestone with the production and delivery of its one-millionth vehicle.
7. NIO Inc. (NYSE:NIO)
Number of Hedge Funds Holders: 20
NIO Inc. (NYSE:NIO) specializes in premium smart electric vehicles and is renowned for its innovative battery swapping technology and Battery as a Service (BaaS) model, which offers flexible battery subscription options. The company’s vehicle lineup includes various SUVs and sedans.
The company operates in China and several European countries, with plans for further global expansion, which is supported by its research and development centers located in important areas worldwide. It takes the 7th spot on our list of best EV stocks.
In July 2023, NIO (NYSE:NIO) introduced a significant advancement in battery technology, a 150 kWh semi-solid-state battery that extends driving ranges to approximately 930 kilometers (578 miles) on a single charge. The technology combines the high energy density of solid-state batteries with the practicality of traditional lithium-ion batteries, which improves vehicle performance and allows current owners to upgrade their battery packs for improved range.
In Q3, the company achieved a new high with 61,855 vehicles delivered, marking an 11.6% growth from the previous year. In September alone, NIO (NYSE:NIO) delivered 21,181 vehicles, a 35.4% increase from the same month last year.
This total includes 20,349 vehicles from its premium brand and 832 from its newly launched family-oriented brand, ONVO. The ONVO brand introduced its first model, the L60, a mid-size smart electric SUV, on September 19, with deliveries beginning shortly after. With over 2,552 battery swap stations established in China, the company is positioned as a distinctive player in the EV charging and battery market.
6. Blue Bird Corporation (NASDAQ:BLBD)
Number of Hedge Funds Holders: 24
One of the best EV stocks, Blue Bird Corporation (NASDAQ:BLBD) is an American manufacturer of school buses, specializing in low and zero-emission models. Its lineup includes traditional school buses, pupil activity buses, and specialized vehicles like security buses, ambulance buses, and blood donation buses.
The company is committed to innovation and safety and transports around 25 million children daily. It currently operates over 20,000 low and zero-emission buses, including those powered by propane, natural gas, and electricity. In August, the company celebrated a milestone by delivering its 2,000th electric, zero-emission school bus.
For the third quarter of fiscal 2024, Blue Bird (NASDAQ:BLBD) reported net sales of $333.4 million, representing a 13.3% increase from $294.3 million in the same quarter of the previous year. This growth was driven by changes in product mix, price adjustments due to rising inventory costs, and a slight uptick in unit bookings. Bus sales rose by $37.8 million, supported by a 13.2% increase in the average sales price and a 0.7% rise in booked units, despite ongoing supply chain challenges.
Parts sales also saw a $1.3 million increase due to inflation-driven price hikes. Although the total cost of goods sold rose to $264.0 million, it improved as a percentage of net sales from 84.5% to 79.2%. Operating profit reached $39.7 million, significantly up from $19.4 million in the same quarter last year, thanks to a $23.6 million rise in gross profit, despite increasing operating expenses.
On October 9, The Fly reported that BTIG initiated its coverage on Blue Bird (NASDAQ:BLBD) with a Buy rating and a price target of $55. The company ranks among the top three manufacturers of school buses and holds a strong position in the alternative fuel school bus market. According to the firm’s analyst, while Blue Bird also sells traditional diesel buses, it focuses on providing value rather than just selling a high volume of these buses.
Despite the stock having doubled in value over the past year, BTIG remains optimistic about the company. It anticipates growth in the North American school bus market and expects a continued shift toward alternative fuels, which could help the company gain more market share.
5. Stellantis N.V. (NYSE:STLA)
Number of Hedge Funds Holders: 31
Stellantis N.V. (NYSE:STLA), formed in 2021 through the merger of Fiat Chrysler Automobiles and the PSA Group, is a prominent global automotive manufacturer. The company owns several well-known brands such as Chrysler, Jeep, Alfa Romeo, Maserati, and Peugeot.
Despite its extensive brand portfolio, which allows it to generate revenue under varying economic conditions, the company faces challenges. In Europe and the U.S., high inventory levels and operational issues in American plants due to union matters have affected its performance.
Nevertheless, the company is strategically focusing on electrification as part of its “Dare Forward 2030” strategy. By 2030, it aims for 100% BEV sales in Europe and 50% in the U.S., with over 75 BEV models planned globally. The company has developed four BEV-native platforms to accommodate different vehicle types, including the STLA Large platform, expected to support multiple vehicle launches with an impressive range capability.
Stellantis (NYSE:STLA) is also expanding its manufacturing capabilities, investing €103 million to improve electric drive module production in Hungary by late 2026. Additionally, the company plans to introduce 48 BEV models by 2024 and offer 30 hybrid models in Europe by the same year, with hybrid sales already increasing significantly.
Partnerships are also significant in the company’s electrification strategy, such as its collaboration with NHOA Energy to develop the Atlante fast-charging network in southern Europe. Moreover, recent investments in Michigan support its commitment to improving EV and hybrid production capabilities, which shows a strong multi-energy strategy that integrates electric, range-extended, and internal combustion engine models.
On October 4, the Wall Street Journal reported that Stellantis (NYSE:STLA) is taking major steps to reduce costs and strengthen its financial position. The company has introduced an internal strategy called the “doghouse,” which focuses on controlling external spending.
Stellantis plans to implement stricter oversight on purchase requests from outside suppliers. CFO Natalie Knight highlighted that improving spending discipline could result in substantial savings. While these guidelines are not entirely new, the approach specifically targets projects that need closer examination without affecting current purchase orders or invoices.
4. Rivian Automotive, Inc. (NASDAQ:RIVN)
Number of Hedge Funds Holders: 37
Rivian Automotive, Inc. (NASDAQ:RIVN) is an American electric vehicle manufacturer founded in 2009, known for producing electric SUVs, pickup trucks, and delivery vans. Its noteworthy products include the R1T pickup truck, which began deliveries in late 2021, and the electric delivery van (EDV) developed for Amazon.
The company has also announced a joint venture with Volkswagen in June to develop advanced electric vehicle architecture and software. This partnership aims to lower costs and accelerate innovation, with new vehicles expected by the end of the decade. Volkswagen plans to invest $5 billion in Rivian, starting with a $1 billion loan convertible into stock.
Despite facing production issues due to a component shortage, Rivian (NASDAQ:RIVN) produced 13,157 vehicles and delivered 10,018 in Q3. It lowered its annual production forecast to 47,000-49,000 vehicles but expects deliveries to reach 50,500-52,000.
On October 21, The Fly reported that RBC Capital cut its price target for Rivian (NASDAQ:RIVN) from $15 to $14 while keeping a Sector Perform rating on the stock. This change is part of a larger report on car companies’ expected results for the third quarter. The whole sector has been struggling lately, and while analysts have reduced their predictions, there’s a chance they might lower them even more because of a gloomy economic outlook. For Rivian, a lower number of deliveries in Q3 could mean the company will change its profit expectations for the fourth quarter. Concerns have also grown about Rivian’s deal with VW after VW issued a profit warning.
Despite the rating, the analyst price target still shows an upside of nearly 40% from current levels on October 22.
3. Ford Motor Company (NYSE:F)
Number of Hedge Funds Holders: 47
Taking the third spot on our list of best EV stocks is Ford Motor Company (NYSE:F), known for its Ford and Lincoln brands. It is transitioning to electrification by converting key models like the Mustang, F-150, and Transit into electric versions, including the Mustang Mach-E and F-150 Lightning. The company is investing in facilities like the Rouge Electric Vehicle Center and focusing on improving battery technology, including solid-state batteries, to achieve carbon neutrality by 2050.
However, due to rising competition and declining global EV sales, the company has reduced its focus on EVs and is shifting toward hybrid technology. By the end of the decade, the company plans to offer hybrid options across its Ford Blue lineup in North America.
In the third quarter, Ford’s (NYSE:F) U.S. retail sales grew 4%, outperforming the market, and its EV sales increased by 12%. It also leads in hybrid truck sales. The F-150 hybrid saw a 64% sales jump, while Lincoln’s sales rose by 26%, with the Nautilus experiencing its best third quarter since 2007. Explorer sales also increased by 25%. Its EV sales are up 45% year-to-date, led by the F-150 Lightning and E-Transit van, and its Ford Pro Intelligence software platform saw a 30% subscription growth.
Ford (NYSE:F) CEO has said that the company plans to introduce a $30,000 all-electric vehicle in about two and a half years, aiming to compete with Chinese automakers and Tesla’s entry-level model. Farley stressed the importance of smaller, affordable EVs over larger electric trucks and SUVs, which he views as less profitable due to the high cost of large batteries. Ford (NYSE:F) is shifting focus to smaller EVs for both economic and environmental reasons.
2. General Motors Company (NYSE:GM)
Number of Hedge Funds Holders: 72
General Motors Company (NYSE:GM), known for brands like Chevrolet, Buick, GMC, and Cadillac, is focused on transitioning to an all-electric future through its vehicle lineup. However, on October 8, GM announced it would discontinue the “Ultium” branding for its electric vehicle batteries and technologies as part of a strategic review. Despite the branding change, GM will continue its EV and battery operations.
In July and August, GM sold nearly 21,000 EVs, approaching its second-quarter totals. The company is aiming for profitability in EV production at 200,000 units and remains committed to becoming fully electric by 2035. In the third quarter, U.S. retail sales rose by 3%, with 659,601 vehicles sold, while EV sales hit a record 32,095 units, marking a 60% year-over-year increase. GM plans to release five ICE models and two new EVs in the fourth quarter.
General Motors (NYSE:GM) released its Q3 earnings on October 22 which exceeded Wall Street’s third-quarter expectations, prompting the company to raise its 2024 guidance. The company reported adjusted earnings per share of $2.96, surpassing the expected $2.43, and revenue of $48.76 billion, higher than the anticipated $44.59 billion.
The company now projects full-year adjusted earnings before interest and taxes between $14 billion and $15 billion, up from previous estimates of $13 billion to $15 billion. It also raised its automotive free cash flow forecast to a range of $12.5 billion to $13.5 billion, up from $9.5 billion to $11.5 billion. Additionally, the automaker adjusted its net income forecast to between $10.4 billion and $11.1 billion, compared to earlier guidance of $10 billion to $11.4 billion.
According to the CEO, Mary T. Barra, General Motors (NYSE:GM) grew its U.S. retail market share with competitive pricing and well-managed inventories in Q3. In China, sales improved, and dealer inventory dropped significantly. The company remains on track to meet its 2024 EV production and profitability goals, benefiting from its dedicated EV platform, U.S. battery manufacturing, and flexible assembly capabilities, advantages that many competitors lack.
Diamond Hill Capital stated the following regarding General Motors Company (NYSE:GM) in its Q2 2024 investor letter:
“Other top Q2 contributors included Extra Space Storage and General Motors Company (NYSE:GM). Shares of automobile manufacturer General Motors (GM) rose as its internal combustion engine business has also received a boost from the recent slowdown in electric vehicle adoption among consumers. GM also announced additional share repurchases in Q2, reinforcing its commitment to returning cash to shareholders.”
1. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Funds Holders: 85
Tesla, Inc. (NASDAQ:TSLA) is an EV company known for its innovations in the automotive and clean energy industries. It designs, manufactures, and sells BEVs and offers energy storage and solar products. Tesla is a key player in the EV market and has influenced the adoption of the North American Charging Standard (NACS), which has been in use since 2012 and gained broader industry acceptance in 2022. It tops our list of best EV stocks to buy.
In Q3, the company’s global vehicle sales rose by 6.4% in the third quarter, marking its first increase this year and suggesting a possible recovery in demand for electric cars as interest rates decline. The company delivered 462,890 vehicles in the third quarter and produced nearly 470,000. Tesla’s (NASDAQ:TSLA) Model 3 and Y were the best-selling products and it delivered nearly 440,000 of those.
At the “We, Robot” event on October 10, the company’s CEO Elon Musk introduced two new vehicles, the Cybercab and Robovan. The Cybercab, designed without a steering wheel or pedals, is expected to cost under $30,000 and begin production in 2026. The Robovan will be capable of transporting up to 20 passengers or cargo. Musk compared the event to the significance of the 2017 Model 3 launch.
In an October 15 newsletter by Cathie Wood’s Ark Disrupt, said that while Tesla’s (NASDAQ:TSLA) stock price declined after the event, the firm still views it in a good light. The firm said that the company plans to introduce unsupervised Full Self-Driving (FSD) in California and Texas next year, with a full robotaxi network expected by 2025 or 2026. The company also intends to sell the Cybercab to consumers and may encourage third-party robotaxi fleet businesses, although most fleets will likely be owned by external operators.
Elon Musk mentioned robotaxi ride costs could range from $0.30-$0.40 per mile, which aligns with research predicting costs around $0.25 per mile. This would be far cheaper than current ride-hailing services and will position robotaxis as a highly competitive option.
The firm said that Tesla’s (NASDAQ:TSLA) stock dropped after the event, likely due to delayed FSD timelines now expected between 2025 and 2026. However, the company’s data advantage may enable it to scale faster than competitors.
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.”
While we acknowledge the potential of Tesla, Inc. (NASDAQ:TSLA) as an investment, 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 TSLA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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