The EV market is getting hot and about to come to a boil, again. If there’s been one major manufacturer to double-down on EV this year there have been a half-dozen or more. With the push to green energy and government policy driving the shift this market is on fire. In our view, as aggressive as the estimates are, a 40% to 50% CAGR for the EV industry may be the benchmark for growth over the next two decades and not the ceiling. Today’s news includes three headlines that have markets moving, headlines that represent opportunities for EV investors.
GM Initiated At Wells Fargo As An EV Leader
GM (NYSE: GM) made headlines in the EV market not once but twice this weekend with the announcement of an all-EV Hummer and initiated coverage by Wells Fargo. The Hummer is slated to be released in 2023 and will be the stablemate to the Hummer Pickup scheduled for release this fall. The Hummer will price in a range of $80,000 to over $110,000 for the top-end models and will be comparable to the pickup in terms of torque, range, and speed. The truck is the first to be built on GM’s new next-generation EV platform and its push toward full electrification by 2035.
As for the analysts, the analysts have been getting even more bullish on EV and GM over the past month or so, Wells Fargo is only the latest. According to Wells Fargo analyst Colin Langan GM is leading the way on several fronts within the EV market including autonomous and connected vehicles. He gave the stock an Overweight rating and price target of $67 or 17.5% upside from Friday’s closing price.
Wells Fargo Gives Nod To Ford, Sees 25% Upside
Wells Fargo also called out Ford (NYSE: F) as a winner in the EV market. Mr. Langan views Ford’s turnaround as “accelerated” and one driven by the push to EV. Not only is the company’s newly honed focus on profitable growth markets spurring sales but EV is leading the way. In terms of sales, Ford defied the expectations for Q1 delivering a 1% increase in YOY sales driven by robust retail and EV sales. Retail sales increased by 24% while EV sales, anchored by the fully-electric Mustang hybrid F-150 models, surged 74%. Ford was also initiated at overweight, its price target is $15 or 25% upside to Friday’s close.
“The turnaround is a massive change. Ford is no longer focused on having a product for all markets, but rather focused on delivering products in segments with competitive strength – pickups & SUVs. Ford N America has one of the strongest line-ups in decades with a refreshed F-150, the Mustang Mach E, & new Broncos. Farley also seems to be accelerating Ford’s shift to EVs upping planned EV investments to $29bn by2025 and targeting only BEV passenger vehicles in Europe by 2030,” says Langan.
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