Which Of These Electric Vehicle Stocks Is A Better Buy?

0
18
Arrival Vs Lucid Motors: Which Of These Electric Vehicle Stocks Is A Better Buy?

April 22, 2021 7 min read

This story originally appeared on StockMarket

Investors are watching these 2 stocks of electric vehicles right now

Electric vehicle inventories are some of the most popular investments on the stock market right now. There are several good reasons for this. For some, top EV stocks offer investors some of the most exciting options. But more importantly, what is really driving the top EV stocks this week is President Joe Biden’s statement on Tuesday. From the virtual tour of Proterra He mentioned that the US should be the world’s largest supplier of electric buses and vehicles. As a result, ArcLight Clean Transition Corp (NASDAQ: ACTC), the special-purpose acquisition company (SPAC) that will merge with Proterra, rose over 15% on Wednesday.

With that in mind, it is important to understand how much the infrastructure plan can make for the EV space. Biden has proposed spending $ 174 billion to boost the production and sales of zero-emission buses and automobiles. The White House’s push towards electrification comes because China has dominated the global market for electric vehicles and buses. As a result, many compile a list of green investing stocks hoping to take advantage of this trend.

Now, after a couple of hushed EV trading sessions, the focus is back on EV startups. And these names are trendy on the stock market today. Among them are Arrival group (NASDAQ: ARVL) and Churchill Capital IV (NYSE: CCIV). These two names seem to be making a comeback on the stock market. Whether they could pose a threat Tesla (NASDAQ: TSLA) is another question that needs to be answered. But now let’s dive into the details of how these two EV stocks stack up against each other.

[Read More] Top cyclical stocks to invest in? 4 To be considered

Arrival group

Arrival is a UK based electric vehicle company primarily focused on light commercial vehicles. The company is now trading on Nasdaq after the merger is complete CIIG Merger Corp., a SPAC.

Since its public debut on March 25, ARVL stock has not performed as many investors would have expected. And that may not come as a surprise considering the company hasn’t shipped any pre-orders yet. However, the president’s comments on the state of the US EV market have ARVL stock on investors’ watch list.

Granted, the production and supply of electric vehicles in the nation is currently well behind China. As a result, many investors speculate that Arrival could fill the void after the company went public last month. The electric bus maker also said it had received great interest in its vehicles. This includes the obligation to buy up to 10,000 electric vehicles from United Parcel Service (NYSE: UPS) as well as the option to order up to 10,000 more.

ARVL Stock received a boost after delivering its first prototype electric delivery van

The company’s share price skyrocketed on Wednesday after reaching a so-called “important milestone” for the company. ARVL stock rose as much as 18% before closing 12% higher that day. It did after the company announced it had shipped its first prototype electric delivery truck to UPS. It should be noted that UPS is also an Investor in Arrival.

best stocks for electric vehicles to buy (ARVL stock price)Source: TD Ameritrade TOS

The company also announced that it will build its first two US “microfactories”. These facilities aim to build electric vehicles without assembly lines. This requires the company to provide less seed capital than traditional manufacturing facilities. Could this make ARVL stock more attractive than other EV stocks? Well, it is certainly risky to invest in EV companies that are not currently making sales. The fact that Arrival delivered its first prototype delivery truck to UPS is positive evidence. And investors are right to cheer.

[Read More] 4 Quantum Computing Stocks To See In April

Lucid Motors – Churchill Capital Corporation IV

Churchill Capital Corp. IV is a special-purpose acquisition company that is merging with Lucid Motors. For the uninitiated, Lucid is an idea from former Tesla chief engineer Peter Rawlinson. Since the merger news was confirmed, the stock has drawn a lot of investor attention. This week, CCIV stock investors are seeing some nice gains along with the wider EV space, which seems to be adding to the tailwind.

SPAC shares (CCIV shares)

Besides having cars with some pretty, sleek designs up for sale in the second half of the year, Lucid is also playing with energy storage. This shows that the EV manufacturer has a few tricks up its sleeve. The company is looking for innovative ways to add value to its product chain.

Maybe it wouldn’t be a very profitable endeavor. However, if Lucid succeeds in this initiative, it could become a bigger player in energy storage than many would have thought.

CCIV stocks play with Biden’s infrastructure plan

As an American electric vehicle company, Lucid is in a good position to grow its business over the next few years. As you may not know, the Biden government is reportedly trying to end a lawsuit over overregulating automotive emissions in California. Should a waiver come under the Clean Air Act, investors believe that stricter fuel emission standards will directly benefit luxury EV manufacturers like Lucid Motors.

Electric vehicle inventories (CCIV share price)Source: TD Ameritrade TOS

Lucid’s near-term prospects seem great even without government incentive. Let’s not forget that the company’s Lucid Air is fully reserved. Some would even say that the valuation of CCIV stock makes it a screaming buy right now. At the current level of around $ 20, the stock is almost 70% below its all-time high. Plus, investors can invest alongside institutional investors like BlackRock. If you think the company could successfully execute its plan and generate over $ 23 billion in sales over the next few years, CCIV stock looks like a bargain right now.

[Read More] The best stocks to buy right now? Knowing 4 Tech Stocks

Conclusion: ARVL Stock Vs CCIV Stock

Now, both electric vehicle manufacturers have not yet sold any vehicles. But they certainly have exciting developments of their own. With Lucid planning to ship its first batch of Lucid Air in the second half of 2021, we could make some revenue this year. This may be enough to allay valuation fears about CCIV stocks. With an annual capacity of 30,000 units at its current Arizona facility, Lucid appears to be in a good position to meet demand for its electric vehicles. In addition, the fact that Lucid is engaged in energy storage could be a sign of greater prospects for the future.

On the other hand, political support for the electrification of school buses and some transit vehicles in the US could be a big catalyst for arrival. As one of the earliest companies to focus on commercial vehicles, this could be a good sign for the company. As a result, many are counting on Arrival to become a major commercial EV supplier. Admittedly, commercial EVs may not get as much attention as passenger EVs. And that’s exactly why the ARVL share could offer a significant uptrend.