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From Lithium to Casinos, Buy These Stocks If You're Bullish on Tesla
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Perhaps no company in the world polarizes investors and analysts as much as Tesla (TSLA - Free Report) . Led by the enigmatic Elon Musk, Tesla is a dominant force in the budding electric car market—but the company’s history of missing production targets produces questions about the stock’s sky-high valuation.
One thing that nearly everyone can agree on is Tesla’s status as an innovator in the automotive industry. Tesla vehicles have some of the longest ranges among consumer electric cars, its “Autopilot” feature was one of the first self-driving platforms to reach the public, and management’s focus on leading the world into the future is commendable.
Naturally, Tesla’s prowess has attracted many admirers. And one of the coolest parts about being an investor is that if you truly believe in the structure and vision of a publicly-traded company, you are free to buy up some of that company’s stock and secure yourself a piece of the expansion that you think will come.
Wall Street has largely proven to be a believer in Tesla, and despite what some might label as hiccups in the company’s growth plan, the stock has soared more than 800% over the best five years—with plenty of investors still confident that the company is only at the beginning of its rise.
If you find yourself in the crowd of investors that think there is plenty more to come from Tesla over the next few years, you might even want to add more exposure to the company’s future to your portfolio right now. Buying more TSLA is always an option, but let’s look at a few other stocks to consider if you are bullish on Tesla.
Lithium Plays
If you are confident in Tesla, that means you are likely a believer in the long-term health of the global lithium market. Tesla and its competitors power their revolutionary electric vehicles with lithium-ion batteries, and rising demand for these batteries should naturally lead to an uptick in lithium mining and production.
The obvious first choice here is Albemarle Corp. (ALB - Free Report) , the world’s largest lithium producer. Albemarle is based in the U.S. and is said to control about 35% of the world’s lithium market. Another option that lithium bulls have targeted is FMC Corp. (FMC - Free Report) , a diversified machinery and chemicals company that is rapidly expanding its lithium capacity (also read: Beyond Tesla: 2 Lithium Stocks to Buy Now).
Suppliers and Partners
Tesla famously owns and operates a large portion of its supply chain, but investors have a few options for cashing in on the company’s direct business relationships. For example, Modine Manufacturing Company (MOD - Free Report) is a manufacturer of heat transfer equipment and has been said to be a key supplier of battery cooling units for the Model S.
To what extent Modine Manufacturing fits into Tesla’s future plans is unknown, but the Model S is still a key model for the company, and Modine is a recognized expert in the heat transfer business. MOD is also currently sporting a Zacks Rank #1 (Strong Buy).
Another stock currently holding a strong-buy ranking and doing business with Tesla is Wall Street darling Nvidia Corporation (NVDA - Free Report) . This red-hot graphics chip maker made its name in the PC gaming market but is now poised to be a top supplier for the next generation of smart vehicles.
Tesla and Nvidia have been partners since the early development of the Model S, and now all Tesla vehicles are equipped with Nvidia-powered supercomputers that run on the chipmaker’s Drive PX computing platform.
But no one company is as invested in Tesla’s future as Panasonic Corporation . The Japanese tech giant agreed to shell out up to $1.6 billion to help build Tesla’s Gigafactory, where it will serve as the car company’s official partner in battery production.
“If Tesla succeeds and the electric vehicle becomes mainstream, the world will be changed and we will have lots of opportunity to grow,” Panasonic’s Kazuhiro Tsuga said at the time of the deal (also read: So, What Actually Is Tesla's Gigafactory?).
Longshot Gigafactory Play
Besides Panasonic, investors looking to bet on the growth of Tesla’s Gigafactory should consider Monarch Casino & Resort Inc. (MCRI - Free Report) . This play might be considered a bit of a gamble (pun intended), but Monarch’s main property is the Atlantis Casino Resort in Reno, Nevada. Reno sits just outside of Sparks, Nevada, the home of the Gigafactory—and many MCRI investors are hoping the casino will benefit from economic growth in the area.
Bottom Line
At today’s valuations, some might consider simply buying Tesla shares a risk. But others consider the stock cheap considering its future potential. For those that lean towards the latter, the above-mentioned stocks are few diversified ways to get even more exposure to Tesla over the coming years.
Want more market analysis from this author? Make sure to follow @Ryan_McQueeneyon Twitter!
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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From Lithium to Casinos, Buy These Stocks If You're Bullish on Tesla
Perhaps no company in the world polarizes investors and analysts as much as Tesla (TSLA - Free Report) . Led by the enigmatic Elon Musk, Tesla is a dominant force in the budding electric car market—but the company’s history of missing production targets produces questions about the stock’s sky-high valuation.
One thing that nearly everyone can agree on is Tesla’s status as an innovator in the automotive industry. Tesla vehicles have some of the longest ranges among consumer electric cars, its “Autopilot” feature was one of the first self-driving platforms to reach the public, and management’s focus on leading the world into the future is commendable.
Naturally, Tesla’s prowess has attracted many admirers. And one of the coolest parts about being an investor is that if you truly believe in the structure and vision of a publicly-traded company, you are free to buy up some of that company’s stock and secure yourself a piece of the expansion that you think will come.
Wall Street has largely proven to be a believer in Tesla, and despite what some might label as hiccups in the company’s growth plan, the stock has soared more than 800% over the best five years—with plenty of investors still confident that the company is only at the beginning of its rise.
If you find yourself in the crowd of investors that think there is plenty more to come from Tesla over the next few years, you might even want to add more exposure to the company’s future to your portfolio right now. Buying more TSLA is always an option, but let’s look at a few other stocks to consider if you are bullish on Tesla.
Lithium Plays
If you are confident in Tesla, that means you are likely a believer in the long-term health of the global lithium market. Tesla and its competitors power their revolutionary electric vehicles with lithium-ion batteries, and rising demand for these batteries should naturally lead to an uptick in lithium mining and production.
The obvious first choice here is Albemarle Corp. (ALB - Free Report) , the world’s largest lithium producer. Albemarle is based in the U.S. and is said to control about 35% of the world’s lithium market. Another option that lithium bulls have targeted is FMC Corp. (FMC - Free Report) , a diversified machinery and chemicals company that is rapidly expanding its lithium capacity (also read: Beyond Tesla: 2 Lithium Stocks to Buy Now).
Suppliers and Partners
Tesla famously owns and operates a large portion of its supply chain, but investors have a few options for cashing in on the company’s direct business relationships. For example, Modine Manufacturing Company (MOD - Free Report) is a manufacturer of heat transfer equipment and has been said to be a key supplier of battery cooling units for the Model S.
To what extent Modine Manufacturing fits into Tesla’s future plans is unknown, but the Model S is still a key model for the company, and Modine is a recognized expert in the heat transfer business. MOD is also currently sporting a Zacks Rank #1 (Strong Buy).
Another stock currently holding a strong-buy ranking and doing business with Tesla is Wall Street darling Nvidia Corporation (NVDA - Free Report) . This red-hot graphics chip maker made its name in the PC gaming market but is now poised to be a top supplier for the next generation of smart vehicles.
Tesla and Nvidia have been partners since the early development of the Model S, and now all Tesla vehicles are equipped with Nvidia-powered supercomputers that run on the chipmaker’s Drive PX computing platform.
But no one company is as invested in Tesla’s future as Panasonic Corporation . The Japanese tech giant agreed to shell out up to $1.6 billion to help build Tesla’s Gigafactory, where it will serve as the car company’s official partner in battery production.
“If Tesla succeeds and the electric vehicle becomes mainstream, the world will be changed and we will have lots of opportunity to grow,” Panasonic’s Kazuhiro Tsuga said at the time of the deal (also read: So, What Actually Is Tesla's Gigafactory?).
Longshot Gigafactory Play
Besides Panasonic, investors looking to bet on the growth of Tesla’s Gigafactory should consider Monarch Casino & Resort Inc. (MCRI - Free Report) . This play might be considered a bit of a gamble (pun intended), but Monarch’s main property is the Atlantis Casino Resort in Reno, Nevada. Reno sits just outside of Sparks, Nevada, the home of the Gigafactory—and many MCRI investors are hoping the casino will benefit from economic growth in the area.
Bottom Line
At today’s valuations, some might consider simply buying Tesla shares a risk. But others consider the stock cheap considering its future potential. For those that lean towards the latter, the above-mentioned stocks are few diversified ways to get even more exposure to Tesla over the coming years.
Want more market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>