The Electric Vehicle market is starting to register some huge growth estimates among analyst and research firms that sell intel to investment managers.
For family offices, hedge funds, private equity managers, and sovereign wealth funds, among others, growth is the mother’s milk. And there aren’t too many places to find it, which is why interest rates are still under long-term benchmarks and trendlines despite the recent run-up.
Facts and Factors just published a new research report to kick off March that estimates the global Electric Vehicles Market will grow at a CAGR of 22% to reach around $700 Billion by 2026 (it was approximately $140 Billion in 2019.
But those estimates are contingent upon new innovations coming from the battery technology players, which might offer some of the most exciting investment opportunities ahead.
With that in mind, we take a look at some of the most interesting opportunities in the space, including: Romeo Power Inc (NYSE:RMO), Quantumscape Corp (NYSE:QS), KULR Technology Group Inc (OTCMKTS:KULR), and Albemarle Corporation (NYSE:ALB).
Romeo Power Inc (NYSE:RMO) bills itself as “an energy technology leader delivering large-scale electrification solutions for complex commercial applications.”
It’s a SPAC deal in the EV supply space that makes battery packs for class 4-8 trucks and buses and high-performance vehicles, along with other commercial vehicles.
Romeo Power Inc (NYSE:RMO) most recently announced that it has entered into a Memorandum of Understanding (MOU) with Ecellix Inc. to cooperate in the development, validation and launch of next-generation battery technology. According to the release, the strategic partnership will combine Ecellix’s groundbreaking, ultra-high capacity eCell technology with Romeo Power’s proven battery packs, modules and battery management system to create advanced electrification solutions for the commercial vehicle industry.
“We are thrilled to collaborate with Ecellix. Their battery material technology is impressive, adding up to 50% more energy to current generation lithium-ion batteries,” said Lionel Selwood, Jr., CEO of Romeo Power. “Together, we can accelerate the clean energy movement and offer tiered products to meet and exceed our customers’ requirements at every level.”
While this is a clear factor, it has been incorporated into a trading tape characterized by a pretty dominant offer, which hasn’t been the type of action RMO shareholders really want to see. In total, over the past five days, shares of the stock have dropped by roughly -7% on above average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities.
Romeo Power Inc (NYSE:RMO) has $544 million in contracted revenue, and another $2.2 billion possible under negotiation. It also received $350 million at closing in the SPAC deal, which stands to be utilized to clear booked orders.
Quantumscape Corp (NYSE:QS) trumpets itself as a company that leads in the development of next generation solid-state lithium-metal batteries for use in electric vehicles.
QuantumScape’s mission is to revolutionize energy storage to enable a sustainable future.
Quantumscape Corp (NYSE:QS) recently cleared a key hurdle in the development of its technology, according to information from the company. QS is attempting to pioneer solid-state lithium-metal batteries for electric vehicles. The recent advance has to do with being able to produce multilayer battery cells, which represents a very important stumbling block in taking the technology from theory to practice in the real-world EV marketplace.
“While there is still a lot of work to be done and we could encounter new challenges as we increase our layer count, this is an incredibly important result, and we are excited to have this so early in the year,” Chief Executive Officer Jagdeep Singh said in a letter to investors that was part of the company’s first quarterly financial report.
The stock has suffered a bit of late, with shares of QS taking a hit in recent action, down about -12% over the past week.
Quantumscape Corp (NYSE:QS) posted a net loss of $694.7 million, or $2.41 a share, and an adjusted operating loss of $22.4 million in Q4. A year ago, the net loss was $14.3 million, or 6 cents a share.
KULR Technology Group Inc (OTCMKTS:KULR) is an emerging player in the EV battery space. The company develops, manufactures and licenses next-generation carbon fiber thermal management technologies for batteries and electronic systems.
It is basically a hedge for L-Ion battery technology by removing downside risk for EV manufacturers through beneficially shifting the probability of negative battery events.
KULR Technology Group Inc (OTCMKTS:KULR) offers lithium-ion battery thermal runaway shields; fiber thermal interface materials; phase change material heatsinks; HYDRA TRS battery storage bags; internal short circuit device; and CRUX cathodes. Its technologies are used in electric vehicles and autonomous driving systems, artificial intelligence and cloud computing, and energy storage and 5G communication technologies.
The company recently announced that Morio Kurosaki is joining the Company as an independent director. Mr. Kurosaki, a seasoned executive and investor in Japan’s information technology industry, brings decades of experience relevant to KULR’s near and long-term growth strategies.
According to the release, Mr. Kurosaki, founder and President of IT-Farm Corporation in Japan, led early investments in notable companies such as Zoom Video Communications (ZM); ContextLogic (WISH); Treasure Data, acquired by ARM Holdings (NVDA); Tubi, acquired by Fox Corporation (FOX); Red Hot Labs, acquired by Google (GOOGL); lvl5, acquired by DoorDash (DASH); Accel Technology, acquired by Marvell Technology Group (MRVL), and Extreme DA, acquired by Synopsis (SNPS).
KULR shares have been moving higher over recent weeks as investors start to discover the name, pushing it up about 40% above average trading volume over the past month. But a breakout above the $3/share level might unleash technical buying to force out shorts and potentially drive further gains.
KULR Technology Group Inc (OTCMKTS:KULR) is an early-stage more speculative player, but with growing exposure and a widening base of core industry ties. The big commercial performance is still ahead and contingent on execution, but the building blocks are in place.
Albemarle Corporation (NYSE:ALB) is a battery player on the materials side. The company operates in three segments: Lithium, Bromine Specialties, and Catalysts.
The Lithium segment offers lithium compounds, including lithium carbonate, lithium hydroxide, lithium chloride, and value-added lithium specialties, as well as reagents, such as butyllithium and lithium aluminum hydride for applications in lithium batteries for consumer electronics and electric vehicles, high performance greases, thermoplastic elastomers for car tires, rubber soles, plastic bottles, catalysts for chemical reactions, organic synthesis processes, life science, pharmaceutical, and other markets.
Albemarle Corporation (NYSE:ALB) just recently announced that the company’s CEO Kent Masters has signed the CEO Action for Diversity & Inclusion pledge.
“We are committed to a culture where our values are clear, all are welcome to collaborate and contribute, and our differences are celebrated as a competitive advantage,” said Masters. “We know that great change comes with great dedication. Through this pledge and our collective commitment to our values and our action plan, we will use the power of diversity and inclusion to strengthen Albemarle and our communities.”
In total, over the past five days, shares of the stock have dropped by roughly -5% on above average trading volume. All in all, not a particularly friendly tape, but one that may ultimately present some new opportunities.
Albemarle Corporation (NYSE:ALB) pulled in sales of $879.1M in its last reported quarterly financials, representing top line growth of -11.4%. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($746.7M against $1.8B, respectively).