As buying an EV over a combustion engine car becomes increasingly a reality for consumers, largely due to EV price points having decreased in recent years, these electric vehicles will require a large and robust charging network to support them. Below, I will explore three EV charging stocks that investors can buy to capitalize on this booming market.
Tesla (TSLA)
By far, Tesla (NASDAQ:TSLA) is the dominant player in the EV charging market. These days, Tesla owns and operates the largest global fast-charging network in the world. TSLA boasts over 50,000 Superchargers across 14 countries. This allows EV drivers to plan long cross-country road trips without worrying about the possibility of getting stranded somewhere.
The automaker managed to beat estimates throughout 2023. In particular, Tesla’s quarterly earnings have come in above analysts’ estimates, and the price-cut strategy the automaker began to pursue in the beginning year has increased quarterly deliveries while also placing pressure on gross margins. Delivery numbers for Q4 2023 were released in early January.
Despite EV demand potentially slipping in the short term, Tesla’s prowess in the charging market remains outmatched thus far. So, for investors interested in companies significantly influencing the charging landscape, Tesla shares are an obvious investment. This makes it one of those EV charging stocks to watch.
Allego N.V. (ALLG)
For those looking to allocate to E.U.-focused EV charging networks, the following entry might be worthwhile. Allego (NYSE:ALLG) is based in the Netherlands and offers solutions for electric cars, motors, buses, and trucks. In essence, Allego provides charging solutions to allow private businesses to create EV charging infrastructure for consumers.
ALLG reported an impressive Q3 print in mid-November. In particular, revenue increased 28.2% to ‚¬28.6 million ($30.2 million), compared to ‚¬ 22.39 million ($21.8 million) year-over-year. Moreover, as of October, Allego recorded over 1 million sessions per month across its charging network. To expand its horizons, towards the end of November, Allego also reported a successful pilot test of its charging station geared toward EV trucks and other heavy-duty vehicles,
As European consumers look to adopt EVs, expanding government support and other secular trends could create tailwinds for EV charging stocks like Allego in the future.
Global X Autonomous & Electric Vehicles ETF (DRIV)
Because many of the companies in the EV charging market are still nascent and are dwarfed by Tesla, many investors may simply want to choose an ETF to have exposure to the different kinds of companies in the space. The Global X Autonomous & Electric Vehicles ETF (NASDAQ:DRIV) may be a good option for those kinds of investors.
The exchange-traded fund holds around 80 different stocks that operate in the autonomous and electric vehicle spaces, many of which construct and maintain EV charging networks of their own. This ETF is trading at around $22.90/share, manages more than $713.31 million in AUM, and has an expense ratio of 0.68%.
The ETF beat the S&P 500 in terms of performance in 2023, yielding a 26% annual return versus the S&P500’s 24% return.
On the date of publication, Tyrik Torres did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tyrik Torres has been studying and participating in financial markets since he was in college, and he has particular passion for helping people understand complex systems. His areas of expertise are semiconductor and enterprise software equities. He has work experience in both investing (public and private markets) and investment banking.