In this article, we will take a look at 10 of the best EV battery stocks to buy in late 2023. To see more such companies, go directly to the 5 Best EV Battery Stocks To Buy in Late 2023.
The momentous shift from the century-long dominance of internal combustion engines to the electric vehicle era is sparking tensions in unexpected sectors of the global economy. This transformative transition is only in its initial stages, promising further developments and challenges ahead. As the global transition to electric vehicles gains momentum, there has been an exponential surge in demand for batteries in significant automotive markets such as Europe and the United States. Automotive and battery manufacturers are grappling with a challenging phase of uncertainty in the battery supply chain, prompting many to consider constructing their battery gigafactories or entering into joint ventures to alleviate the pressures on the supply.
The International Energy Agency (IEA) predicts that Electric Vehicles (EVs) will constitute 18% of the global vehicle market in 2023, amounting to 14 million sales—a significant increase from the 14% market share in 2022. The first half of 2023 has already demonstrated the robust performance of EVs, with a 25% year-over-year sales increase in the first quarter. Additionally, a PwC report indicates that Battery Electric Vehicle (BEV) sales alone experienced a substantial 52% surge in the second quarter of 2023. Anticipated to rise by approximately 30%, reaching nearly 4,500 gigawatt-hours (GWh) annually worldwide by 2030, McKinsey predicts that the demand for batteries is poised for significant growth. The battery value chain is projected to expand by up to tenfold between 2020 and 2030, potentially generating annual revenue as high as $410 billion. By 2030, it is predicted that 40% of the demand for lithium-ion batteries will emanate from China.
On the other side of the globe, amid the swift ascendance of electric vehicles, the United States market has become a focal point of significant developments, challenging the skepticism surrounding the industry's expansion. Despite the notable increase, EVs represented approximately 7.2% of total sales from January through June this year. While this marked a 5.4% year-over-year increase, the relatively small market share indicates substantial growth potential for car companies in the EV sector.
In addition, forecasters such as Schmidt Automotive Research (SAR), which had previously indicated a plateau in 2024, anticipate a robust resurgence in sales from 2025 to 2030. Even after acknowledging the slowdown, investment bank UBS maintains a positive European forecast through 2030. Schmidt Automotive suggests that Europeans may find some relief, as the anticipated influx of highly competitive EVs from China is likely to be postponed due to a shortage of shipping capacity. With that said, the global electric-vehicle market maintains robust performance, as evidenced by China's record monthly sales in September and October, even after the cessation of subsidies. In September, the global leader in the EV market race recorded a year-to-date increase of 29%. Concurrently, the global EV market exhibited a 34% growth during the same period.
Ultimately, although lithium-ion batteries remain central to the electric vehicle industry because of their elevated energy density, they come with inherent toxicity and potential dangers in certain situations. A battery technology poised to replace lithium-ion batteries and offer significantly enhanced energy density and performance is solid-state batteries. These batteries eschew a liquid electrolyte for electricity conduction, thereby enhancing the flow of current between the negative and positive terminals.
With these details in mind, let’s take a look at some of the best EV battery stocks to buy as we move into the last month of 2023, with some notable names including the likes of General Motors Company (NYSE:GM), Tesla, Inc. (NASDAQ:TSLA), and Honeywell International Inc. (NASDAQ:HON).
A fleet of battery-electric commercial vehicles lined up against a sleek charging infrastructure.
In the process of compiling our selection of the best EV battery stocks to invest in, we initially identified 28 companies involved in lithium supply, battery sales, or technologies related to battery operations. From this pool, we selected the stocks with the highest hedge fund investor participation in Q2 2023, designating them as the top battery stocks to buy in late 2023.
10. Solid Power, Inc. (NASDAQ:SLDP)
Number of Hedge Fund Holders: 16
Headquartered in Louisville, Colorado, Solid Power Inc. (NASDAQ:SLDP) is a company specializing in automotive parts and equipment. Focused on the electric vehicle market, the company is engaged in the development of solid-state battery technologies. Additionally, Solid Power sells its sulfide-based solid electrolyte and offers licenses for its solid-state cell designs and manufacturing processes.
In the second quarter, the company witnessed a substantial increase, with revenue reaching $4.9 million, marking a $2.3 million rise compared to the second quarter of 2022. The first-half revenue for 2023 amounted to $8.7 million, reflecting a year-over-year increase of $3.9 million. With the company's batteries gaining more traction among automakers in the final quarter of 2023, investors can anticipate a continued upward trajectory in revenue.
By the end of this year's second quarter, 16 out of the 910 hedge funds polled by Insider Monkey had held a stake in Solid Power, Inc. (NASDAQ:SLDP). Out of these, the largest shareholder is Ken Griffin's Citadel Investment Group as it owns 1.5 million shares that are worth $3.8 million.
In addition to General Motors Company (NYSE:GM), Tesla, Inc. (NASDAQ:TSLA), and Honeywell International Inc. (NASDAQ:HON), Solid Power Inc. (NASDAQ:SLDP) is a notable EV battery stock to keep tabs on.
9. QuantumScape Corporation (NYSE:QS)
Number of Hedge Fund Holders: 17
QuantumScape Corporation (NYSE:QS), a company in the developmental stage, is dedicated to the advancement of solid-state lithium-metal batteries designed for electric vehicles and diverse applications. This positions it as a stock suitable for long-term investment, as the shares have the potential to increase in value if a significant breakthrough occurs.
QuantumScape Corporation (NYSE:QS) has demonstrated encouraging advancements in cell tests. According to its recent quarterly report, the top-performing prototype A0 cell, developed in collaboration with Volkswagen, has surpassed both its own performance objectives and those of any other automotive battery cell. Notably, the latest A0 prototype cell achieved over 1,000 full cycle equivalents with over 95% discharge energy retention in a battery testing lab belonging to one of its potential customers. This achievement exceeds QuantumScape's targets for commercialization, which were set at 800 cycles and 80% energy retention.
As per Insider Monkey’s database for the second quarter of 2023, 17 hedge funds were bullish on QuantumScape Corporation (NASDAQ:QS), compared to 15 funds in the previous quarter. Philippe Laffont’s Coatue Management has the largest position in the company, with 3.06 million shares valued at over $24.49 million.
8. FREYR Battery (NYSE:FREY)
Number of Hedge Fund Holders: 18
FREYR Battery (NYSE:FREY) is actively engaged in the manufacturing and promotion of battery cells utilized for stationary energy storage, electric mobility, and marine applications throughout Europe and on a global scale. The company's primary goal is to provide large-scale environmentally friendly battery solutions, contributing to the global reduction of emissions.
By the conclusion of Q2 2023, 18 hedge funds expressed optimism about FREYR Battery (NYSE:FREY), revealing holdings valued at $171.7 million in the company. This contrasts with the 20 positions disclosed in the preceding quarter, with stakes totaling $176.1 million. As of Q2, Encompass Capital Advisors, led by Todd J. Kantor, holds the leading investment position in the company, with a stake valued at $64.99 million.
7. Enovix Corporation (NASDAQ:ENVX)
Number of Hedge Fund Holders: 20
Enovix Corporation (NASDAQ:ENVX) is a leading player in the development and production of advanced silicon-anode lithium-ion batteries. The company's distinctive 3D cell design enhances energy density while maintaining a prolonged cycle life.
On September 22, Enovix Corporation (NASDAQ:ENVX) announced its acquisition of Routejade, a reputable battery manufacturer based in Korea. The transaction involves approximately 6.2 million shares of Enovix common stock and around $16.5 million in cash, assuming a complete purchase of Routejade. This strategic move provides the company with vertical integration encompassing electrode coating and battery pack manufacturing. It also brings on board an established lithium-ion battery enterprise with operational facilities in Korea, along with valuable additional products, clientele, and suppliers. The transaction is expected to be finalized in the fourth quarter of 2023, promising immediate accretion to Enovix Corporation (NASDAQ:ENVX).
By the end of 2023’s second quarter, 20 out of the 910 hedge funds tracked by Insider Monkey had held a stake in Enovix Corporation (NASDAQ:ENVX). Peter S. Park’s Park West Asset Management is the company’s biggest hedge fund investor since it owns $97 million worth of shares.
6. Sociedad Química y Minera de Chile S.A. (NYSE:SQM)
Number of Hedge Fund Holders: 24
Sociedad Química y Minera de Chile S.A. (NYSE:SQM) is a Chilean chemical company that specializes in the manufacture of plant nutrients, iodine, lithium, and industrial chemicals. Renowned as one of the world's largest lithium producers, SQM primarily conducts its main production operations in the Atacama Desert, spanning the Tarapacá and Antofagasta regions, capitalizing on the region's plentiful natural resources. It offers derivatives and carbonates for use in batteries, among more.
24 out of the 910 hedge funds part of Insider Monkey's Q2 2023 research had invested in the company. Sociedad Química y Minera de Chile S.A. (NYSE:SQM)'s biggest hedge fund investor in our database is Ken Griffin's Citadel Investment Group since it owns $118 million worth of shares.
Sociedad Química y Minera de Chile S.A. (NYSE:SQM) join the the likes of General Motors Company (NYSE:GM), Tesla, Inc. (NASDAQ:TSLA), and Honeywell International Inc. (NASDAQ:HON) as one of the best EV battery stocks to buy in late 2023.
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Disclosure: None. 10 Best EV Battery Stocks To Buy in Late 2023. is originally published on Insider Monkey.