A Christmas Wish List For EV Makers

Wall Street is unanimous about the massive electric vehicle market opportunity set to unfold in the coming years. Against this backdrop, an analyst at Wedbush pondered what could be on Christmas wish lists for the EV makers.

Christmas Wish List: The EV sectors would be hoping for two things heading into Christmas and the end of the year, Ives said.

  • Moderation in the chip shortage that severely constrained production.
  • Hope the EV demand inflection predicted for 2022 materializes.

$5T Market Opportunity Over Next Decade: The EV revolution expected to materialize in 2022 and beyond will translate to a $5 trillion market opportunity over the next decade, Ives said in the note. Tesla Inc TSLA will be the major beneficiary of the inflection, the analyst said.

Others such as traditional automakers General Motors Company GM, Volkswagen AG VWAGY and Ford Motor Company F, as well as EV-focused vendors Canoo Inc GOEV, Lucid Group Inc LCID, Fisker Inc FSR and Rivian Automotive Inc RIVN also stand to capitalize, he added.

Europe and China have seen a clear acceleration in EV adoption. The U.S., with just 2% penetration, lags behind, the analyst noted.

EV supply chain plays such as Li-Cycle Holdings Corp LICY, ChargePoint Holdings Inc CHPT, Evgo Inc EVGO, Electric Last Mile Solutions Inc ELMS, Xos Inc XOS and Hyzon Motors Inc HYZN, among others are well-positioned to benefit, Ives said.

On the software front, connected data plays such as Wejo Group Ltd WEJO are likely to benefit from the next generation of EVs and adoption taking hold over the next 12 to 18 months, he added.

Related Link: Tesla Vs. Rivian Vs. Lucid Vs. Fisker Vs. Lordstown Vs. Canoo: How BofA Says The EV Makers Stack Up

EV Valuations Reflecting Future Growth: EV valuations continue to soar, leading many to wonder whether this is a bubble or the first stage of a decade-long EV metamorphosis, Ives said.

"The EV stocks are reflecting future parabolic growth and margin potential over the coming years, with now the execution/capacity story taking hold into 2022," the analyst wrote in the note.

Photo: Michael Fousert on Unsplash

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