Stocks

3 Electric Vehicle Stocks to Avoid at All Costs in 2021

Electric-vehicle stocks have charged higher in 2020, with investors enthusiastically buying into the revolution that is disrupting the automotive industry.

The potential is real, but the stocks appear to be getting ahead of themselves. Many of the companies surging higher have yet to generate any meaningful revenue, and even those that are selling products are trading at very un-auto-like valuations. 

Some of these companies will turn into long-term success stories, but for now the stocks look frothy. Here is why three Fool.com contributors are avoiding buying QuantumScape (NYSE:QS), ElectraMeccanica Vehicles (NASDAQ:SOLO), and Tesla (NASDAQ:TSLA) heading into 2021.

Engineers working on an electric vehicle.

Image source: Getty Images.

This battery stock is overheated

Lou Whiteman (QuantumScape): I’m a current QuantumScape shareholder, so it might sound strange for me to advise others to avoid it. Bottom line up front: I love the potential for this company, but I can’t

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Luminar Is Overhyped: These Self-Driving Car Stocks Are Better Buys Right Now

It has been a banner year for stocks of companies that want to disrupt the automotive industry, and Luminar Technologies (NASDAQ:LAZR) is the latest to ride the wave.

Luminar is a maker of lidar, a technology that uses pulsed laser beams to measure distances that are used in most self-driving concepts. The company went public on Dec. 3 through a reverse merger and the stock almost immediately doubled in value.

Investors are excited about the potential of the technology to help make robocars a reality. Alas the lidar market is getting somewhat crowded, and Luminar has a lot to prove in the quarters ahead to justify those sorts of gains. 

The potential is real, but the markets are getting way ahead of themselves in terms of the valuation. Here’s why three Fools believe General Motors (NYSE:GM), Velodyne Lidar (NASDAQ:VLDR), and XPeng

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Ignore NIO, These 3 Stocks Are Better Buys Right Now

It’s been an amazing year for electric-vehicle stocks, as a new generation of start-ups has joined Tesla in capturing the imagination of investors.

Chinese electric car company NIO (NYSE:NIO) has led the way, with its shares up more than 1,000% for the year as investors bet on disruption as the automotive industry goes electric.

NIO is an exciting company, but it’s fair to say a lot of that enthusiasm is already priced into the shares. NIO currently trade at about 20 times expected sales over the next 12 months.

Given that valuation, it might be best to focus attention on other options right now. Here’s why we think Li Auto (NASDAQ:LI), General Motors (NYSE:GM), and Hyliion Holdings (NYSE:HYLN) are better buys today.

Illustration of a vehicle driving over currency.

Image source: Getty Images.

Li Auto Is Carving Out a Profitable Niche

Lou Whiteman (Li Auto): Li Auto

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3 Monster Growth Stocks That Are Still in the Buy Zone

With markets generally rising for now – the S&P is up over 9% in the past 30 days – investors are taking a close look at growth stocks. These are the equities that show long-term appreciation, with returns to investors based mainly on share price gains. It’s an obvious move to make, when the mood on the Street is bullish.

The professional analyst corps understand this, and they have been scouring the market for stocks that show signs of powerful growth ahead. These aren’t necessarily the big names – but they are likely to bring the returns that make investing profitable.

Dipping into the TipRanks database, we’ve pulled up the stats on three such stocks. They all have doubled or more so far this year, boast Buy ratings, and show double digit upside potential, according to Wall Street analysts.

Open Lending Corporation (LPRO)

Americans love their cars

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