The EV stocks discussed in this article have the best shot of becoming multibaggers, in my view. I came to this conclusion through a thorough analysis of the electric vehicle industry and the companies operating within it.
Although there are risks that should be acknowledged, these companies are well-positioned to capitalize on the immense growth potential of the EV industry. These brands are leveraging their first-mover advantages, innovative tech, and more to carve out a strong competitive position for themselves.
So here are seven EV stocks that could be multibaggers in the making. Investors of all risk tolerances and time horizons should consider the companies on this list.
EV Stocks: Tesla (TSLA)
Tesla (NASDAQ:TSLA) is at the forefront of EV technology with a market value that dwarfs traditional carmakers. It could also double in value or more as per my valuation analysis.
Last year, TSLA showcased strong financial performance, with a 19% increase in total revenue, reaching $96.8 billion. The year concluded with a significant GAAP net income of $15 billion, boosted by a one-time non-cash tax benefit.
My thesis for TSLA is that it’s one of the leaders in EV infrastructure, which will give it a significant advantage over its peers.
For 2024, Tesla plans a substantial increase in capital expenditure to $10 billion, aiming to initiate its next growth phase. This increase in spending, up from $8.9 billion in 2023, is part of Tesla’s preparation for launching its next-generation vehicles and expanding its Supercharger network. This network expansion is particularly crucial in North America as Tesla plans to start integrating non-Tesla drivers.
General Motors (GM)
General Motors (NYSE:GM) could become a multibagger due to its low valuation and future growth prospects.
The company reported a revenue of $42.98 billion for the fourth quarter, slightly down from the previous year but above expectations. The company’s adjusted EBIT for the year was $12.4 billion, aligning with its adjusted outlook.
For 2024, GM forecasts an adjusted EBIT of $12 billion to $14 billion and adjusted earnings per share of $8.50 to $9.50. The company aims to sell at least 250,000 EVs in 2024, adjusting from its previous target due to challenges in the EV rollout.
Additionally, GM announced a $10 billion accelerated share repurchase program and plans to increase its common stock dividend by 33% starting in January.
Trading at just 5.8 times earnings, GM has the room left in its financial to support a much more robust stock price than it trades at already.
EV Stocks: Ford (F)
Ford (NYSE:F) is part of the traditional automakers’ shift towards electric vehicles, facing similar economic pressures as its counterparts in adapting to the EV market’s demands. Still, I like F’s prospects a lot for me to rate it as one of those potential multibaggers. Its plans for this year supports this view.
The company is introducing seven new electric vehicles, including three passenger and four commercial vehicles, as part of its strategy to sell over 600,000 EVs annually in Europe by 2026. This initiative is aligned with Ford’s global ambition to produce more than 2 million EVs per year by 2026, aiming for a 10% adjusted EBIT margin.
Investments to support Ford’s electrification strategy include a $2 billion commitment to new electric vehicle production in Cologne and the formation of a joint venture for battery production in Turkey, targeting an annual capacity likely in the range of 30 to 45 Gigawatt hours.
XPeng (XPEV)
XPeng (NYSE:XPEV) is a Chinese EV maker focusing on SUVs and sedans, outpacing U.S. counterparts with a significant increase in deliveries.
The company delivered 141,601 vehicles throughout 2023, representing a 17% increase from the previous year, and culminating in a record-breaking December with 20,115 vehicle deliveries. This push increased XPeng’s total deliveries to over 400,000 units since its inception. The end of the year also saw the commencement of the X9 model’s customer deliveries, following its official launch.
XPEV ended the year with a 23% increase in both EV deliveries and revenue, reaching $3.89 billion, as well as substantial cash reserves.
For this year, the company plans to launch the G6 SUV and a new electric 7-seat MPV. It’s also exploring higher levels of autonomous driving technology through the use of AI. I think its autonomous driving tech could be what sets it apart as it’s one of the few EV stock leaning so heavily into this area.
EV Stocks: Fisker (FSR)
Fisker (NYSE:FSR) has set its sights on selling between 20,000 to 22,000 vehicles, directly to consumers and dealers, with average selling prices expected to range from $56,000 to $62,000.
The company also anticipates a substantial portion of its cash flow in the first half of 2024 to come from the sale of vehicles produced in 2023, which are largely already paid for. Additionally, Fisker has projected its non-GAAP operating expenses and capital expenditures for 2024 to be within the range of $320 million to $390 million.
There’s a huge predicted average revenue growth rate of 391.45% over the next few years for FSKR. Also, the 12-month price target for FSR stock among analysts is $2.73, presenting a significant potential upside from the current stock price.
FSR could then be one of those underappreciated picks in the market due to its strong revenue growth projections and stock price target in the near-term.
NIO (NIO)
NIO (NYSE:NIO) stands out in China’s EV market with impressive vehicle delivery growth. If NIO’s delivery growth continues as it has, then I feel there’s a real possibility it could turn into a multibagger.
In 2023, NIO delivered 160,038 vehicles, marking a 30.7% year-over-year (YOY) increase. By the end of 2023, cumulative vehicle deliveries reached 449,594. In December alone, NIO delivered 18,012 vehicles, a 13.9% increase compared to the previous year.
Looking ahead to 2024, NIO has set a target for vehicle deliveries over 230,000 units. This forecast suggests a nearly 50% increase in deliveries compared to the full-year expectations for 2023. Additionally, NIO is preparing to launch a new model under its Alps sub-brand in the second half of 2024, based on the NT 3.0 platform.
Analysts predict that NIO’s revenue will grow significantly by 2024, although the company is still forecasted to experience losses until at least 2025. Financial estimates for the end of 2024 anticipate revenues of 70.81 billion CNY but with a net loss of 15.97 billion CNY
Blue Bird (BLBD)
Blue Bird (NASDAQ:BLBD) specializes in electric buses, receiving strong buy ratings and demonstrating significant investor interest.
I feel that BLBD has a strong chance to become a multibagger for investors. Here’s why.
Last year, the company’s net sales soared by 41% to reach $1,132.8 million, while its GAAP net income improved dramatically to $23.8 million, a $69.6 million increase from the previous year. Adjusted EBITDA also reflected this positive trend, climbing to $87.9 million, up $102.7 million compared to the prior year.
Building on this momentum, Blue Bird started fiscal 2024 with record first-quarter earnings. The company reported net sales of $317.7 million, up 35% YOY, and a GAAP net income of $26.2 million, marking a significant rise. Adjusted EBITDA reached an all-time high of $47.6 million, up $51.1 million from the same quarter last year. The success was attributed to increased unit sales, up by 9%.
BLBD also recently raised its guidance for FY2024. The company now forecasts net revenue to be between $1.15 billion and $1.25 billion, with adjusted EBITDA expected to be in the range of $120 million to $140 million, and adjusted free cash flow projected to be between $60 million and $70 million.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Matthew started writing coverage of the financial markets during the crypto boom of 2017 and was also a team member of several fintech startups. He then started writing about Australian and U.S. equities for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and the New Scientist magazine, among others.