Companies that build products and technology for the EV market without actually manufacturing the cars themselves may offer investors opportunities they haven’t considered.
Real Money’s Jim Collins explored this idea recently in a piece identifying some of the plays he’s keeping an eye on: Read Here Are 5 Electric Vehicle Accessory and Tech Names to Watch; and get more of his trading ideas and investing strategies.
Collins writes: “In the interest of presenting some compelling emerging growth ideas in this mega-cap-dominated market, I decided to run with the ball myself.
“The companies you really should be watching? Exro Technologies EXROF, Lomiko Metals LMRMF, Naqi Logix, Nano One Materials NNOMF and Vicinity Motor VEV.”
What’s the theme among these disparate companies? All of them build products and technology for the EV market without actually manufacturing the cars themselves.
Collins says that in an emerging space, the best thing you can do is pick the right winners. Investors who can successfully pick the car companies that will dominate electric vehicles, they’ll do very well.
But when there’s no good way to know who will win or lose in advance, the next best thing is to invest in the industry at large. Buy stock in the companies that build things every electric vehicle will need. It doesn’t matter whether Tesla (TSLA) – Get Tesla Inc Report, Ford (F) – Get Ford Motor Company Report or General Motors (GM) – Get General Motors Company (GM) Report crushes this market, you’ll be sitting on a stock with value to any (or every) winner.
For example, Collins writes:
“Massive opportunities exist for both Nano and Exro. Nano’s patented One-Pot process and proprietary M2CAM technology can vastly improve the performance and durability of the cathode in an electric vehicle battery, while lowering the carbon density of the materials that are shipped (on ships powered by hydrocarbons) from disparate regions to EV battery manufacturers.
“Exro’s coil drivers enable multiple torque profiles from an EV powertrain, especially useful at the larger (trucks, buses, trains) and smaller ends (e-bikes, scooters) of the transportation spectrum. Exro also has a proprietary battery control technology, which will enable current-gen lithium-ion battery stacks to gain a second life instead of heading to a landfill.”
This is exactly the kind of industry-wide infrastructure that investors can look for. If you think the EV industry will do well as a whole, you can try to capitalize on that success by investing in the companies that will underpin the entire sector.