Electric vehicles have been gaining momentum, and battery stocks are now on the radar. Tesla (NASDAQ:TSLA) shares have surged by over 950% within the past five years. Investors look for similar opportunities when a stock has that type of moment and rewards long-term investors to that degree.
Many electric vehicle stocks saw their prices soar in 2021. Some of these stocks deserved the price growth, while others gave away their gains in 2022 and 2023. Companies like Nikola Motors (NASDAQ:NKLA) and Workhorse (NASDAQ:WKHS) saw their share prices collapse from their all-time highs, with no path of recovery in sight.
While EV vehicle producers have attracted many investors, the battery stocks are also worth a closer look. These companies produce the batteries necessary for EV vehicles and gather the necessary materials. Some of these companies have additional revenue streams, which do not make them entirely dependent on the EV market. Investors looking for growth opportunities may want to buy these top battery stocks.
Albemarle (NYSE:ALB) is a specialty chemicals manufacturing company that uses lithium and other raw materials.
Lithium is an important component of electric vehicle batteries and stands to become a more valuable resource as electric vehicles gain popularity. More automobile companies are producing electric vehicles and will need lithium from miners like Albemarle. Rising demand and limited supply bodes well for the company and its investors.
Shares have almost doubled over the past five years, and investors should expect more gains if electric vehicles become more mainstream. The stock has a low valuation, highlighted by its 7.5 forward P/E ratio. Albemarle trades at a 0.80% dividend yield. The company enjoys a 27.4% profit margin and saw its revenue and earnings grow by double-digits year-over-year in the second quarter.
Investors can choose from other lithium producers, but Albemarle is the largest in the world and has mines on multiple continents.
Panasonic Holdings (PCRFY)
Panasonic Holdings (OTCMKTS:PCRFY) is a conglomerate that produces batteries for Tesla vehicles. This relationship puts Panasonic in a position to soar as Tesla sells more EVs. The company is expanding its partnership with Tesla and recently announced it will boost battery production at Tesla’s Nevada Gigafactory by 10%.
Panasonic has expanded its partnerships with other electric vehicle (EV) companies to reduce its dependence on Tesla. The company has joined forces with Lucid Motors (NASDAQ:LCID) to supply EV batteries for their vehicles. Panasonic will manufacture batteries for the complete range of Lucid’s vehicles, including the Lucid Air and Gravity SUV. Lucid Motors is keen to increase production, and Panasonic will reap the benefits of this demand.
Panasonic creates other types of batteries and has income streams outside of EV batteries. The company currently has a 9 P/E ratio and a dividend yield approaching 2%. Shares have gained 37% year-to-date. Panasonic is a durable company that has been in business for over 100 years.
Nano One Materials (NNOMF)
Source: JLStock / Shutterstock.com
Nano One Materials (OCTMKTS:NNOMF) is a speculative EV investment that has gained almost 40% year-to-date. The company has a market cap of under C$350 million. Nano One has innovative technology that can make batteries more affordable and effective. The company produces cathode active materials, a component lithium-ion batteries need.
The firm has several patents that protect its technology and model from competitors. Nano One has a total of 27 issued patents and more than 55 patent applications that are pending.
Nano One Materials’ partnership with Our Next Energy can help the stock gain momentum. Under this partnership, Nano One Materials and Our Next Energy will work together to produce lithium iron phosphate cathode active materials.
Nano One Materials is the type of stock that spooks away value investors. However, investors willing to start a small position in this stock can see a significant upside if the firm perfects its technology and works with EV producers.
On this date of publication, Marc Guberti 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.
Marc Guberti is a finance freelance writer at InvestorPlace.com who hosts the Breakthrough Success Podcast. He has contributed to several publications, including the U.S. News & World Report, Benzinga, and Joy Wallet.
More From InvestorPlace
- ChatGPT IPO Could Shock the World, Make This Move Before the Announcement
- Musk’s “Project Omega” May Be Set to Mint New Millionaires. Here’s How to Get In.
- The Rich Use This Income Secret (NOT Dividends) Far More Than Regular Investors
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.