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The Zacks Analyst Blog Highlights: Tesla, Nio Inc., General Motors, and Ford.
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For Immediate Release
Chicago, IL – January 3, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Tesla (TSLA - Free Report) , Nio Inc. (NIO - Free Report) , General Motors (GM - Free Report) , and Ford (F - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
Top EV Stocks to Soar in 2022 Even If Chip Crunch Lingers
In first-half 2020, the auto industry suffered a massive blow due to coronavirus-led factory closures, low footfall at dealerships and economic uncertainty. Nonetheless, in the latter half of 2020 and early 2021, pent-up demand and preference for personal mobility amid the socially-distant milieu resulted in a faster-than-expected rebound of vehicle sales.
But just when things started looking up for the auto market, another speed bump in the form of a shortage in the supply of semiconductors engulfed the industry. The global chip crisis and tight inventory levels have been hurting vehicle sales volumes since mid-2021. Discouragingly, IHS Markit expects chip deficit to persist through 2022.
Yet, one trend that held strong even in the face of chip famine was the rising sales of green vehicles. Per the U.S. Energy Information Administration (“EIA”), global EV registrations surged 41% in 2020. Per BloombergNEF, global EV sales are expected to skyrocket 168% in 2021 from 2019 levels.
A host of factors such as pollution issues, technical superiority and stricter fuel-emission standards have turned the fortunes in favor of electric vehicles (EVs). The demand for electric cars is off the charts. With e-mobility trends becoming hotter with each passing day, auto giants have been accelerating their EV game.
Even a microchip shortfall and industry challenges are not holding back automakers to invest heavily in EV technology and development. In fact, companies are prioritizing resources to manufacture EV models over the low-margin traditional vehicles. Pure-play EV players are fast filing IPOs to capitalize on the rising electrification trends. While EV makers are getting all charged up, countries, states, and cities are also stepping up their clean energy and e-mobility targets.
The race to EV supremacy is only going to get fiercer in the upcoming years. EIA expects EVs to account for 30% of all light-duty vehicle sales by 2050, up from a mere 0.7% in 2020. Per a Deloitte Report, the EV market is estimated to reach 31.1 million units by 2030 from 2.5 million units in 2020, witnessing a CAGR of 29% during the forecast period.
While the overall auto industry outlook for 2022 may appear uncertain amid chip woes, EV sales will be a growth pole for the industry, with various new models set to hit the market next year. To capitalize on this e-mobility frenzy, we highlight four stocks (two EV pure plays and two legacy automakers) that are set to soar in 2022.
Tesla: The first name that pops into our mind is Tesla. Shares of the EV king rose 53.9% year to date and we believe that the momentum will continue. Valued at more than $1 trillion, Tesla is riding on rising demand for Models 3 and Y. The company hit an incredible milestone in the last reported quarter, with record deliveries and production.
Most importantly, gross margin — excluding credits — came in at +28.8%, at or near an all-time record high. Over a multi-year horizon, Tesla anticipates achieving 50% average annual growth in vehicle deliveries. With China being the biggest EV market, the Shanghai factory is further fueling TSLA’s revenue prospects.
Given the tailwinds, Tesla is likely to maintain its upward trajectory in 2022 as well. The company currently sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for TSLA’s 2022 earnings and sales implies year-over-year growth of 31% and 40%, respectively. You can see the complete list of today’s Zacks #1 Rank stocks here.
NIO Inc.: While shares of China-based NIO have declined around 40% year to date amid regulatory concerns in the country and equity offerings, the stock is likely to rebound in 2022 on the back of several positive catalysts. The soaring popularity of ES6, ES8 and EC6 models is likely to buoy NIO’s prospects.
Next year, the firm intends to deliver three new products based on the NIO Technology Platform 2.0, including the ET7 model. Deliveries of ET7 are scheduled to commence in first-quarter 2022. At the NIO Day event held this month, the EV star of China unveiled its midsize sedan, the ET5, whose deliveries are set to begin in September 2022. NIO’s battery swap technology, international expansion plans and strong liquidity profile also augur well.
Although the stock has underperformed this year, it’s prudent to stay invested in NIO as it seems well positioned for a rally next year. The Zacks Consensus Estimate for NIO’s 2022 earnings and sales implies year-over-year growth of 90% and 83%, respectively. The company currently carries a Zacks Rank #3 (Hold).
General Motors: Shares of this U.S. auto giant have increased 37.6% year to date and there is certainly much upside potential for the stock in 2022 as well. At its Investor Day event held in October, General Motors’ CEO Marry Barra made a bold claim indicating that the company is on track to become the U.S. market share leader in the EV space.
The automaker plans to roll out 30 fresh EV models by 2025-end. This month, it commenced deliveries of its much-anticipated GMC Hummer EV pickup. General Motors’ own modular battery platform, the Ultium Drive system, will aid in the transition to an all-electric portfolio down the road. General Motors projects annual EV revenues to scale from $10 billion in 2023 to $90 billion by decade-end.
Considering its ambitious electrification targets, we believe General Motors is set to maintain its good show on the bourses in 2022 as well. The company currently carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for GM’s 2022 earnings and sales implies year-over-year growth of 1% and 15%, respectively.
Ford: Another legacy automaker that is hitting all the right notes toward an electrified future is Ford. Shares of Ford have surged more than 135% year to date and the stock is expected to keep its winning streak alive in 2022 as well on the back of promising fundamentals.
While Mustang Mach-E has already become a hit among consumers and is boosting the company’s sales, the much-awaited electric version of the hot-selling pickup F-150 is set to further fuel Ford’s prospects. Early this month, Ford confirmed that it had 200,000 reservations for its all-electric F-150 Lightning pickup, whose deliveries are expected to commence next year. Ford’s efforts to boost its battery technology, proprietary software and hardware stack named Blue Oval Intelligence and joint venture deals with SK innovation offer growth visibility.
Currently hovering around 52-week highs, Ford is set to fly higher next year. So, retain this Zacks Rank #3 stock in your portfolio to reap handsome rewards. The Zacks Consensus Estimate for F’s 2022 earnings and sales implies year-over-year growth of 2% and 13%, respectively.
Zacks Top 10 Stocks for 2022
In addition to the investment ideas discussed above, would you like to know about our 10 top picks for the entirety of 2022?
From inception in 2012 through November, the Zacks Top 10 Stocks gained an impressive +962.5% versus the S&P 500’s +329.4%. Now our Director of Research is combing through 4,000 companies covered by the Zacks Rank to handpick the best 10 tickers to buy and hold. Don’t miss your chance to get in on these stocks when they’re released on January 3.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: Tesla, Nio Inc., General Motors, and Ford.
For Immediate Release
Chicago, IL – January 3, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Tesla (TSLA - Free Report) , Nio Inc. (NIO - Free Report) , General Motors (GM - Free Report) , and Ford (F - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
Top EV Stocks to Soar in 2022 Even If Chip Crunch Lingers
In first-half 2020, the auto industry suffered a massive blow due to coronavirus-led factory closures, low footfall at dealerships and economic uncertainty. Nonetheless, in the latter half of 2020 and early 2021, pent-up demand and preference for personal mobility amid the socially-distant milieu resulted in a faster-than-expected rebound of vehicle sales.
But just when things started looking up for the auto market, another speed bump in the form of a shortage in the supply of semiconductors engulfed the industry. The global chip crisis and tight inventory levels have been hurting vehicle sales volumes since mid-2021. Discouragingly, IHS Markit expects chip deficit to persist through 2022.
Yet, one trend that held strong even in the face of chip famine was the rising sales of green vehicles. Per the U.S. Energy Information Administration (“EIA”), global EV registrations surged 41% in 2020. Per BloombergNEF, global EV sales are expected to skyrocket 168% in 2021 from 2019 levels.
A host of factors such as pollution issues, technical superiority and stricter fuel-emission standards have turned the fortunes in favor of electric vehicles (EVs). The demand for electric cars is off the charts. With e-mobility trends becoming hotter with each passing day, auto giants have been accelerating their EV game.
Even a microchip shortfall and industry challenges are not holding back automakers to invest heavily in EV technology and development. In fact, companies are prioritizing resources to manufacture EV models over the low-margin traditional vehicles. Pure-play EV players are fast filing IPOs to capitalize on the rising electrification trends. While EV makers are getting all charged up, countries, states, and cities are also stepping up their clean energy and e-mobility targets.
The race to EV supremacy is only going to get fiercer in the upcoming years. EIA expects EVs to account for 30% of all light-duty vehicle sales by 2050, up from a mere 0.7% in 2020. Per a Deloitte Report, the EV market is estimated to reach 31.1 million units by 2030 from 2.5 million units in 2020, witnessing a CAGR of 29% during the forecast period.
While the overall auto industry outlook for 2022 may appear uncertain amid chip woes, EV sales will be a growth pole for the industry, with various new models set to hit the market next year. To capitalize on this e-mobility frenzy, we highlight four stocks (two EV pure plays and two legacy automakers) that are set to soar in 2022.
Tesla: The first name that pops into our mind is Tesla. Shares of the EV king rose 53.9% year to date and we believe that the momentum will continue. Valued at more than $1 trillion, Tesla is riding on rising demand for Models 3 and Y. The company hit an incredible milestone in the last reported quarter, with record deliveries and production.
Most importantly, gross margin — excluding credits — came in at +28.8%, at or near an all-time record high. Over a multi-year horizon, Tesla anticipates achieving 50% average annual growth in vehicle deliveries. With China being the biggest EV market, the Shanghai factory is further fueling TSLA’s revenue prospects.
Given the tailwinds, Tesla is likely to maintain its upward trajectory in 2022 as well. The company currently sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for TSLA’s 2022 earnings and sales implies year-over-year growth of 31% and 40%, respectively. You can see the complete list of today’s Zacks #1 Rank stocks here.
NIO Inc.: While shares of China-based NIO have declined around 40% year to date amid regulatory concerns in the country and equity offerings, the stock is likely to rebound in 2022 on the back of several positive catalysts. The soaring popularity of ES6, ES8 and EC6 models is likely to buoy NIO’s prospects.
Next year, the firm intends to deliver three new products based on the NIO Technology Platform 2.0, including the ET7 model. Deliveries of ET7 are scheduled to commence in first-quarter 2022. At the NIO Day event held this month, the EV star of China unveiled its midsize sedan, the ET5, whose deliveries are set to begin in September 2022. NIO’s battery swap technology, international expansion plans and strong liquidity profile also augur well.
Although the stock has underperformed this year, it’s prudent to stay invested in NIO as it seems well positioned for a rally next year. The Zacks Consensus Estimate for NIO’s 2022 earnings and sales implies year-over-year growth of 90% and 83%, respectively. The company currently carries a Zacks Rank #3 (Hold).
General Motors: Shares of this U.S. auto giant have increased 37.6% year to date and there is certainly much upside potential for the stock in 2022 as well. At its Investor Day event held in October, General Motors’ CEO Marry Barra made a bold claim indicating that the company is on track to become the U.S. market share leader in the EV space.
The automaker plans to roll out 30 fresh EV models by 2025-end. This month, it commenced deliveries of its much-anticipated GMC Hummer EV pickup. General Motors’ own modular battery platform, the Ultium Drive system, will aid in the transition to an all-electric portfolio down the road. General Motors projects annual EV revenues to scale from $10 billion in 2023 to $90 billion by decade-end.
Considering its ambitious electrification targets, we believe General Motors is set to maintain its good show on the bourses in 2022 as well. The company currently carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for GM’s 2022 earnings and sales implies year-over-year growth of 1% and 15%, respectively.
Ford: Another legacy automaker that is hitting all the right notes toward an electrified future is Ford. Shares of Ford have surged more than 135% year to date and the stock is expected to keep its winning streak alive in 2022 as well on the back of promising fundamentals.
While Mustang Mach-E has already become a hit among consumers and is boosting the company’s sales, the much-awaited electric version of the hot-selling pickup F-150 is set to further fuel Ford’s prospects. Early this month, Ford confirmed that it had 200,000 reservations for its all-electric F-150 Lightning pickup, whose deliveries are expected to commence next year. Ford’s efforts to boost its battery technology, proprietary software and hardware stack named Blue Oval Intelligence and joint venture deals with SK innovation offer growth visibility.
Currently hovering around 52-week highs, Ford is set to fly higher next year. So, retain this Zacks Rank #3 stock in your portfolio to reap handsome rewards. The Zacks Consensus Estimate for F’s 2022 earnings and sales implies year-over-year growth of 2% and 13%, respectively.
Zacks Top 10 Stocks for 2022
In addition to the investment ideas discussed above, would you like to know about our 10 top picks for the entirety of 2022?
From inception in 2012 through November, the Zacks Top 10 Stocks gained an impressive +962.5% versus the S&P 500’s +329.4%. Now our Director of Research is combing through 4,000 companies covered by the Zacks Rank to handpick the best 10 tickers to buy and hold. Don’t miss your chance to get in on these stocks when they’re released on January 3.
Be First to New Top 10 Stocks >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.