We recently compiled a list of the 15 Biggest EV Stocks in the World in 2024 and in this article, we discuss whether Tesla, Inc. (NASDAQ:TSLA) is the biggest EV stock in the world in 2024.
According to the Global EV Outlook 2024 by the International Energy Agency, electric car sales surged in 2023, reaching nearly 14 million globally. This represents a 35% jump from 2022 and brings the total number of electric cars on the road to 40 million. Weekly registrations in 2023 surpassed the entire annual total from just ten years ago. Electric cars now account for 18% of all car sales globally, a significant climb from 2% in 2018. This rapid growth indicates a maturing electric car market with strong momentum. Interestingly, battery electric cars make up the majority (70%) of electric vehicles on the road today.
Approximately 95% of these sales were concentrated in China, Europe, and the United States, which dominate new electric car registrations. In these regions, electric cars represent a significant share of their local markets, with over 30% in China and over 20% in Europe. As these three key markets account for two-thirds of total car sales globally, their swift adoption of electric vehicles has a significant influence on worldwide trends.
As a result, many of the major EV manufacturers are based in these countries. However, emerging players are also making their mark in other regions. For instance, a subsidiary of Vietnamese conglomerate Vingroup made its debut on NASDAQ in August 2023. The company was valued at approximately $23 billion through a SPAC deal. The company has already entered the North American market, importing about 2,100 EVs from Vietnam to the US and 800 to Canada.
In addition to US, China, and Europe, emerging markets like Southeast Asia and Brazil are also seeing rising EV sales, supported by various incentives and investments. In terms of the future outlook for electric vehicles, the long-term goals of top automakers in the world are quite ambitious. If achieved, they could put over 20 million electric cars on the road by 2030. This will lead to electric vehicles making up between 42% and 58% of car sales by 2030, exceeding even the most optimistic forecasts. The electric vehicle market size is predicted to reach over $950 billion by 2030 with a compound annual growth rate (CAGR) of 13.7% between 2023 and 2030.
Key drivers for growth in the Global EV market include decreasing EV battery prices and supportive government policies. The fastest-growing market segments are fuel-cell electric vehicles (FCEVs) and mid-priced EVs. Additionally, the Asia-Pacific region is expected to lead market growth. However, challenges such as high initial investments for charging infrastructure could impede growth.
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Our Methodology
To compile our list of the 15 biggest EV stocks in the world in 2024, we shortlisted companies on the basis of their market capitalization. We have only included companies that are pure play in the EV sector or have substantial exposure to the sector. The biggest EV stocks in the world in 2024 have been ranked in ascending order of their market capitalization figures in USD. We also scanned our database of 919 hedge funds (as of Q1 2024) to share the number of hedge fund investors, where applicable.
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Is Tesla, Inc. (NASDAQ:TSLA) the Biggest EV Stock in the World in 2024?
Tesla, Inc. (NASDAQ:TSLA)
Market Capitalization: $557.6 Billion
Number of Hedge Fund Holders: 74
Tesla, Inc. (NASDAQ:TSLA), a leading American clean energy company headquartered in Austin, Texas, is a powerhouse in electric vehicles. Tesla, Inc. (NASDAQ:TSLA) designs, manufactures, and sells not just EVs, but also energy storage solutions, solar panels, and even solar shingles.
The company is expected to strengthen its product pipeline further in 2024 with the release of the Cyber truck and Tesla Semi. In Q1 2024, the company’s energy division achieved significant progress, with margins hitting a record high of 24.6%. Energy storage deployments are expected to grow by at least 75% in 2024 compared to 2023.
However, Tesla, Inc. (NASDAQ:TSLA) reported a 9% decline in first-quarter revenue, marking the largest drop since 2012 and falling short of analysts’ expectations. This decrease is attributed to the impact of ongoing price cuts on the electric vehicle company. During the earnings call, CEO Elon Musk informed investors that the production of new affordable EV models might start earlier than expected.
The average price target for Tesla, Inc. (NASDAQ:TSLA) from over 50 analysts stands at $183. This target price reflects an upside potential of over 4% from the current price levels.
Here’s what Baron Funds said about Tesla, Inc. (NASDAQ:TSLA) in its Q1 2024 investor letter:
“The vast majority of the Fund’s underperformance this quarter stemmed from the Fund’s 10-year investment in Tesla, Inc. (NASDAQ:TSLA). Tesla’s shares fell 29.3% during the period and detracted 13.41% from the Fund’s first quarter results. Although Tesla has contributed importantly to the Fund’s performance since 2014, on occasion it has detracted from quarterly performance. In previous instances when Tesla shares have underperformed during a discrete period, they have shortly afterwards reflected the strong growth of the underlying business and the stock has appreciated considerably. We believe that will be the case again, although cannot guarantee it.
A significant decline also occurred at the end of 2022. In that instance, investors had become concerned about a host of external factors. Investors believed the company founder, visionary, and CEO Elon Musk was distracted by his acquisition of Twitter. They also believed a weak Chinese economy emerging from COVID and U.S. government policies would curtail the purchases of Tesla vehicles. These fears proved to be overblown. As the company achieved milestones in the succeeding year, the stock subsequently doubled over the next 12 months…” (Click here to read the full text)
As the biggest EV stock in the world in 2024, Tesla, Inc. (NASDAQ:TSLA) is held by 74 hedge funds as of Q1 2024.
Overall, Tesla, Inc. (NASDAQ:TSLA) ranks 1st among the 15 biggest EV stocks in the world in 2024. You can visit the 15 Biggest EV Stocks in the World in 2024 to see the other electric vehicle companies that are on the hedge fund radar.
While we acknowledge the potential of electric vehicle companies, 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 NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure. None. This article is originally published on Insider Monkey.