Goldman Sachs experts say stocks of some manufacturers of electric cars you should choose for investment, and what the share is worth to hold.
Forecasts of Wall Street analysts regarding companies of green energy improve, since governments declare ambitious plans for electrification and reduced carbon emissions.
It is expected that the administration of the new President of the USA Joe Biden will more actively act in relation to electrification programmes transport policies and environmental protection.
In its recent report, the largest investment Bank Goldman Sachs (GS) reported that according to its projections, global sales of electric vehicles this year will reach 1.8 million units by 2025 the figure will rise to 8.3 million and in 2035 could reach 34 million as a result, electric cars will account for 18% of global sales in 2030 and 29% in 2035. Thus, the greatest growth will be in the USA and Western Europe, where the share of electric vehicles can reach 50% in 2035.
Leading analysts of Goldman identified two companies for the production of electric cars, predicting them the lead in the next four years. There is also a manufacturer that deserves attention, but his stock is getting a recommendation to “hold and see”.
Li Auto
Chinese Auto company Li (LI), debuting on the NASDAQ this summer, showed strong growth rates of 91.5% since the first trading day amid high demand for its electric cars in the domestic market of China.
The first model Li – hybrid crossover Li ONE was released in November last year and October this year, the company sold over 22,000 units. In October, the sales volume has reached 3700 that have made Li ONE of the best-selling model of electric vehicle in China.
With a strong public policy of electrification of transport, with benefits for producers and a population of 1.4 billion, China represents the largest market of electric vehicles.
Cars Li also benefit because they are plug-in hybrids have a gasoline engine, which is important since China is in the process of building charging stations and their current network is limited.
Goldman Sachs analyst FEI Fang Li evaluates stocks rated “buy” and target price of $60, which is almost twice the closing price on Monday of $31.5.
With regard to the average of estimates on Wall Street, other analysts also demonstrate an optimistic position in relation to Li: three evaluate the stock as “buy” and one recommends to keep the shares, while the average price target of $36,65 tells about the forecast growth of 16% from the current share price.
Tesla
With an increase of 667% since the beginning of the year and the upcoming addition to the S&P 500 index, the shares of Tesla (TSLA) are the absolute winners of the electric car market, at least in the short term.
Tesla achieved record deliveries, revenue growth of 39% in the last quarter and profit for three consecutive quarters.
Market analysts also estimated stable free cash flow of the automaker’s $1.4 billion for the quarter.
Goldman analyst mark Delaney recently wrote: “We believe that the price of batteries are falling faster than we previously expected, which improves the economic performance of owning electric vehicles. Increased the number of regulatory proposals to restrict or totally ban the sale of new cars with internal combustion engines (ice) in 10-20 years in some countries.”
Assessing Tesla’s shares as a “buy” despite this growth, Delany also gave the highest rating price target on Wall Street of $780, which implies a potential growth by 21.5% in the next 12 months. However, the estimates of other analysts differ still skeptical or cautious approach to Tesla. The average rating among 25 analysts is to “hold” and an average target price of Tesla stock is $403,24, indicating a possible decrease of 37% from current levels.
Nio
Growth stocks Limited Nio (NIO) since the beginning of the year surpassed Tesla and amounted to 1022%. The company clearly deserves attention and monitoring, but experts at Goldman estimated its shares rated “hold” at the same time, their target price of $59 by 30.8% above the closing price Monday of $by 45.11.
Rating Wall Street is regarded as a “moderate buy”, based on 7 ratings a “buy” and 4 “hold”. Meanwhile, the average target price of $49 implies a potential growth of 8.8%.
For the last quarter of the Chinese manufacturer of electric cars reported a 146% growth of income and increase postawko 2.5 times compared to last year’s values. His new electric crossover Nio CE6 is considered as an rival of the upcoming Y Model from Tesla in China.
Company Nio has announced a new scheme of leasing the batteries instead of direct purchase, which reduces the sticker price of cars.
Among other announcements Nio: rechargeable battery with a capacity of 100 kilowatt-hours, which will increase the cruising range of electric vehicles to 615 km, and plans to increase production and start exports to Europe in 2021.
