In this article, we discuss 5 EV stocks to buy as Tesla’s market share declines. If you want to see more stocks in this list, click 10 EV Stocks to Buy as Tesla’s Market Share Declines.
5. Lucid Group, Inc. (NASDAQ:LCID)
Number of Hedge Fund Holders: 16
Lucid Group, Inc. (NASDAQ:LCID) is a California-based automotive company that designs and builds electric vehicles, EV powertrains, and battery systems. On June 24, the company announced the official opening of its first retail location in Seattle, which marks the firm’s 28th studio and service center location in North America.
On May 9, Citi analyst Itay Michaeli reaffirmed a Buy rating on Lucid Group, Inc. (NASDAQ:LCID) and lowered the price target on the stock to $36 from $45. There were no major surprises in Lucid Group, Inc. (NASDAQ:LCID)’s Q1 results and the company posted a “fairly encouraging update”, the analyst told investors in a research note.
According to Insider Monkey’s Q1 data, 16 hedge funds were bullish on Lucid Group, Inc. (NASDAQ:LCID), up from 14 funds in the earlier quarter. The total stakes in the March 2022 quarter increased to $159 million from approximately $149 million in Q4 2021.
4. NIO Inc. (NYSE:NIO)
Number of Hedge Fund Holders: 26
NIO Inc. (NYSE:NIO) is a manufacturer of smart electric vehicles in China. On July 1, NIO Inc. (NYSE:NIO) reported delivering 12,961 vehicles in June 2022, representing a robust increase of 60.3% year-over-year. Cumulative deliveries were 217,897 as of June 30, and Q2 deliveries jumped 14.4% year-over-year to 25,059, ahead of the guidance of 23,000 to 25,000 units.
HSBC analyst Yuqian Ding on June 30 raised the price target on NIO Inc. (NYSE:NIO) to $28 from $26 and reiterated a Buy rating on the shares, citing greater conviction in the fundamental outlook. The U.S. share price has rebounded 6% since Q1, driven by the continuous improvement from three new models in the second half and more models expected to release after 2022.
According to Insider Monkey’s data, NIO Inc. (NYSE:NIO) was part of 26 public hedge fund portfolios, compared to 30 funds in the earlier quarter. D E Shaw is one of the leading shareholders of the company, with 5.4 million shares worth about $115 million.
Here is what Horos Asset Management has to say about NIO Inc. (NYSE:NIO) in its Q1 2022 investor letter:
“At the beginning of April the CSRC (China Securities Regulatory Commission) announced possible changes in its regulation that would allow this inspection by foreign auditors, provided that the companies previously communicate to this body the state secrets that would be exposed, as well as the sensitive information that they might have to hand over, and the subsequent audit is carried out in a framework of collaboration with the CSRC. In short, a move in the direction desired by the SEC, although still far from the optimal result, that is, unrestricted access to information. While these negotiations between the two regulatory bodies are progressing, Chinese companies have to decide how best to preserve their interests. Other entities, such as the electric vehicle manufacturer Nio, have just started trading on this stock market.”
3. Li Auto Inc. (NASDAQ:LI)
Number of Hedge Fund Holders: 28
Li Auto Inc. (NASDAQ:LI) was founded in 2015 and is headquartered in Beijing, China. The company manufactures and sells new energy vehicles and smart electric sport utility vehicles. Li Auto Inc. (NASDAQ:LI) delivered 13,024 Li ONEs in June 2022, an increase of 68.9% year over year. The guidance range for Q2 deliveries was 21,000 to 24,000 units, but the company outperformed guidance by distributing 28,687 vehicles, representing a 63.2% year-over-year increase. Since first manufacturing its EVs in 2019, the company has delivered a total of 184,491 units as of June 2022.
On June 29, after Li Auto Inc. (NASDAQ:LI) reported that it would issue up to $2 billion of ADS on Nasdaq and will use the resultant money for R&D of next-gen BEVs, smart cockpits, and autonomous driving, Morgan Stanley analyst Tim Hsiao contended that investors might be worried that an at-the-market offering could be a short-term stock overhang. However, he sees capital replenishment as “a strategic positive” and believes that paired with Li Auto Inc. (NASDAQ:LI)’s $8 billion in cash reserves and liquid assets, it can finance the company’s strategic and product goals amid rising economic slowdown fears. The analyst maintained an Overweight rating and a $41 price target on Li Auto Inc. (NASDAQ:LI) shares.
In Q1 2022, 28 hedge funds reported long positions in Li Auto Inc. (NASDAQ:LI), up from 24 funds in the last quarter. Chase Coleman’s Tiger Global Management held the leading position in the company, comprising 19.7 million shares worth $510.8 million.
2. Ford Motor Company (NYSE:F)
Number of Hedge Fund Holders: 46
Ford Motor Company (NYSE:F) is a Michigan-based automaker that specializes in sport utility vehicles, electrified vehicles, and Lincoln luxury vehicles. On June 22, the company announced plans to achieve zero carbon emissions for all vehicle sales in Europe by 2035. The company’s EV manufacturing plant in Valencia, Spain is expected to meet European demand later this decade. Similarly, Ford Motor Company (NYSE:F) spent $2 billion on its Cologne, Germany plant with the ambition of producing electric passenger vehicles beginning in 2023.
On June 1, Citi analyst Itay Michaeli maintained a Neutral rating on Ford Motor Company (NYSE:F) and lowered the price target on the shares to $15 from $18. The analyst’s latest “U.S. Vehicle Density Survey” was mixed, declining year-over-year but still reflecting an upward trend suggesting the U.S. SAAR can jump to more than 17 million in the coming years, which he thinks would potentially sustain tight supply/demand through 2024. Resultantly, the analyst is opening a “90-Day Upside Catalyst Watch” on Ford Motor Company (NYSE:F), observing a short-term scenario with “reassuring” U.S. auto data to benefit the stock.
According to Insider Monkey’s Q1 data, 46 hedge funds were bullish on Ford Motor Company (NYSE:F), with collective stakes worth $1.2 billion. Billionaire Ken Griffin’s Citadel Investment Group is one of the leading position holders in the company, with roughly 8 million shares worth $133.7 million.
Here is what Baron Fund has to say about Ford Motor Company (NYSE:F) in its Q1 2022 investor letter:
“Ford (NYSE:F) is another example of typical industrial manufacturing business executive mindsets. The April 18, 2022, Bloomberg Businessweek cover story features Ford CEO Jim Farley behind the wheel of an electrified Ford F-150 Lightning. The article is titled, “Hey Elon, THIS is a truck.” I thought the article was terrific. One idea especially stood out to me. Since the F-150 is such a popular vehicle, it “argued for a gradual approach to electrification. Essentially the company retrofitted an existing F-150 with an electric powertrain rather than develop an entirely new truck.” No all-in financial and operation bet by this company on electrification.”
1. General Motors Company (NYSE:GM)
Number of Hedge Fund Holders: 76
General Motors Company (NYSE:GM) is the largest American automaker that specializes in traditional and electrified vehicles. On June 21, the company announced that it is planning to cover $5 billion in elevated supply chain costs by increasing prices and lowering expenses. However, this has not impacted the robust demand across the GM portfolio. The company also reaffirmed on July 1 its FY2022 net income guidance ranging between $9.6 billion and $11.2 billion, and EPS-diluted guidance range of between $5.76 and $6.76.
In the U.S. autos and industrial technology sectors, Goldman Sachs analyst Mark Delaney lowered estimates and price targets to accurately factor in supply chain constraints in the short-term and softer demand in the medium-term. The analyst reiterated a Buy recommendation on General Motors Company (NYSE:GM) on June 1, but cut the price target on the stock to $46 from $59.
Among the hedge funds tracked by Insider Monkey, 76 funds were long General Motors Company (NYSE:GM) in Q1 2022, compared to 90 funds in the last quarter. Warren Buffett’s Berkshire Hathaway is the biggest shareholder of the company, with over 62 million shares worth $2.7 billion.
Here is what Oakmark Global Fund has to say about General Motors Company (NYSE:GM) in its Q1 2022 investor letter:
“General Motors (NYSE:GM) was a detractor during the quarter, due to increased macro uncertainty, higher fuel prices, and concerns over rising input costs, which pressured the company in particular and the auto industry as a whole. While we are closely monitoring the potential impact of these dynamics, industry demand remains robust, driven by strong consumer balance sheets and pent-up demand after multiple years of constrained production. We also remain confident in GM’s ability to navigate a complex operating environment, which the company has consistently demonstrated over the past few years. Finally, the long-term picture remains bright. We believe GM is significantly undervalued, is well-positioned for the long-term transition to electric vehicles and has numerous needle-moving ancillary business opportunities (most notably Cruise, which is an industry leader in autonomous vehicle technology) that are under-appreciated.”
You can also take a look at Jim Cramer Recommends These 10 Stocks For Recession and Michael Burry is Buying These 10 Stocks As Recession Fears Mount.
