3 EV Stocks to Buy Before They Zoom Higher

Stocks to buy

With the United Auto Workers (UAW) union still on strike, the automotive industry continues in flux. Consequentially, the growth of electric vehicles continues uninterrupted. Demand for battery-powered cars, trucks, and sport utility vehicles (SUVs) continues rising.

According to the International Energy Agency (IEA), the number of electric vehicles sold worldwide has tripled. In the last three years, the number accounts for 14% of total sales in 2022, up from just 4% in 2020. Last year, global sales of electric vehicles surpassed 10 million for the first time. Automakers in Europe, Asia and North America are spending billions of dollars to electrify their fleets.

In this fast-moving environment, clear winners are emerging. Investors should capitalize on the opportunity, especially with these three EV stocks to buy now.

Tesla (TSLA)

Source: Roschetzky Photography / Shutterstock.com

Down 8% in the last month and 15% below its 52-week high, Tesla (NASDAQ:TSLA) shares present on the cheap side.

The decline comes after Tesla announced its Q3 delivery figures a few weeks ago. The company reported delivery of 435,059 vehicles in the three months ended September 30. That is down 7% from the previous quarter and also below the 459,949 vehicles that analysts expected it to deliver.

True, analysts and investors weren’t thrilled with the delivery numbers. Then again, they also weren’t happy when Tesla made an announcement a few days later. The company cut the prices on some editions of its Model 3 and Model Y electric vehicles in the U.S. as sales continue to slump. Effective immediately, the starting price for the Model 3 has been lowered to $38,990 from $40,240 previously. Tesla’s Model Y SUV has seen its starting price dropped to $52,490 from $54,490.

The delivery miss, slumping sales, and price cuts have investors hitting sell on TSLA stock right now. However, investors in it for the long haul should buy the dip now before share price zooms higher.

Li Auto (LI)

Source: Robert Way / Shutterstock.com

Li Auto (NASDAQ:LI) has been racing ahead this year. The Chinese automaker’s share price is up 63% year to date (YTD), up 81% over the past 12 months and up 114% through five years.

Li Auto has emerged as a clear winner in the crowded Chinese market for electric vehicle makers, owing its gains to the their strong delivery numbers. Most recently, Li Auto announced delivery of 36,060 vehicles this September, a 212% year-over-year (YOY) increase, setting a new monthly record.

Li Auto is the first Chinese electric vehicle maker to reach 500,000 cumulative deliveries. And it continues to gain market share in the nation of 1.4 billion people. Also, LI has topped sales of pricier electric SUVs in China for six consecutive months. Further, the company is a luxury EV maker, commanding higher prices across most of its models. In addition, the company has been launching a series of new models that are proving popular with consumers. This year alone, Li Auto has launched three brand new vehicles, including the Li L9, a luxury full-size crossover SUV that is selling particularly well.

Ford Motor Co. (F)

Source: TY Lim / Shutterstock.com

Admittedly, optics don’t look great at the Ford Motor Co. (NYSE:F) at the moment. On October 11, the United Auto Workers (UAW) expanded its strike against the automaker to its Kentucky truck plant. It happens to be Ford’s largest manufacturing plant worldwide with nearly 9,000 workers onsite and $25 billion in annual sales. The Kentucky plant is the facility where Ford manufacturers its popular F-series pick-up trucks, as well as its Lincoln Navigator and Ford Expedition SUVs.

The current strike is a problem for Ford, who now has 17,000 unionized workers off the job. However, it is a problem that will eventually be resolved. The automaker recently achieved a new collective agreement with its unionized workers in Canada. And the current labor unrest shouldn’t detract from Ford’s long-term electric vehicle strategy. Ford is investing more than $50 billion through 2026 to develop electric versions of its popular vehicles ranging from the F-150 pick-up truck to the Mustang muscle car.

In the meantime, the UAW strike has pushed F stock down below $12 a share, which is 23% lower than its 52-week high. Trading at just 11 times future earnings and with a quarterly dividend that offers a 5.08% yield, Ford’s stock looks like good value currently.

On the date of publication, Joel Baglole did not have (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.

Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.

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