This is a big week for investors, with the FOMC Taper announcement, over 200 earnings announcements, an OPEC meeting, and the monthly employment report to round it out on Friday.
However, among all of these stories, the most important for investors may well be “COP26” – the United Nations Climate Change ‘Conference of the Parties’ 26th annual summit happening this week in Dublin.
The sustainability investing theme is perhaps the most important one in play right now in a market context defined by retail investor flows. Hence, the most important global conference in more than a half-decade, marking capital commitments from every major government on the planet, is likely to have a defining impact on portfolios.
As a case in point, Bank of America recently estimated that a third of global equity inflows are currently headed into sustainable funds over coming periods.
One of the biggest winners is likely to be the Electric Vehicle and Lithium-Ion battery space. This has already been widely appreciated by owners of shares in Tesla Inc. (Nasdaq:TSLA). But the space is about more than just TSLA. And future gains will likely be found elsewhere.
With that in mind, we take a look at some of the most compelling opportunities aligned with this theme.
NIO Inc. ADR (NYSE:NIO) engages in the design, manufacture, and sale of electric vehicles. Its products include the EP9 supercar and ES8 7-seater SUV. It provides users with home charging, power express valet services, and other power solutions including access to public charging, access to power mobile charging trucks, and battery swapping.
It also offers other value-added services such as service package, battery payment arrangement, and vehicle financing and license plate registration.
NIO Inc. ADR (NYSE:NIO) recently announced its October 2021 delivery results. According to the release, NIO delivered 3,667 vehicles in October 2021, representing a decrease of 27.5% year-over-year. The vehicle delivery in October was significantly impacted by reduction in production volume as a result of the restructuring and upgrades of manufacturing lines and the preparation of new products introduction from September 28 to October 15, as well as certain supply chain volatilities. Despite the production and supply chain challenges, the Company’s new order reached another all-time high in October driven by increasing user demand.
Due to the restructuring and upgrade scheduling, ES8 production was resumed towards the end of October. The deliveries in October consisted of 218 ES8s, the Company’s six-seater or seven-seater flagship premium smart electric SUV, 2,528 ES6s, the Company’s five-seater high-performance premium smart electric SUV, and 921 EC6s, the Company’s five-seater premium smart electric coupe SUV. As of October 31, 2021, cumulative deliveries of the ES8, ES6 and EC6 reached 145,703 vehicles.
And the stock has been acting well over recent days, up something like 6% in that time. Shares of the stock have powered higher over the past month, rallying roughly 23% in that time on strong overall action.
NIO Inc. ADR (NYSE:NIO) managed to rope in revenues totaling $1.3B in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 149.4%, as compared to year-ago data in comparable terms. In addition, the company has a strong balance sheet, with cash levels exceeding current liabilities ($7.5B against $3.4B).
KULR Technology Group Inc (NYSEAMERICAN:KULR) could be the most interesting name in the EV and Lithium-Ion battery space given its recent landmark contract with the Department of Energy in partnership with Clarios, the world’s biggest supplier of automotive batteries. The stock has been leading the space on the upside over the past few weeks, and this news could help to blow the top off the bottle.
Not enough people are aware of this company. KULR has a 30-year history tied to carbon fiber thermal energy management technology for aerospace and defense applications. The company has already built custom heat management technology for two NASA JPL space missions (Mars Perseverance Rover and the mission to put a human back on the Moon’s surface by 2025) and its tech is currently in use on the International Space Station. KULR has also already won over 30 NASA contracts, and has inked deals with the DoT and USAF. And now it has partnered with the world’s leading auto battery supplier and the US DoE.
KULR Technology Group Inc (NYSEAMERICAN:KULR), as outlined, just announced that it has joined Clarios in the U.S. Department of Energy’s lithium-ion battery lifecycle initiative to develop the manufacturing and reuse of lithium-ion batteries and their chemical elements in the United States for the purpose of domestic national interest. KULR will provide the safe transportation of lithium-ion batteries within the full battery management lifecycle, from manufacturing through recycling and reuse.
According to the release, the initiative, funded by the U.S. Department of Energy, will leverage the KULR-Tech Safe Case and the Company’s highest available energy capacity permit from the U.S. Department of Transportation (“DoT”), which allows for shipping up to 2.1KWh (kilowatt-hour) capacity per case. The DoT special permit has been approved for the recycling of damaged, defective, or recalled (“DDR”) and prototype battery shipments.
The Clarios project, “Powering the Future,” works with industry partners, such as KULR, to develop and apply innovative technologies that identify and separate lithium-ion batteries from lead-acid batteries and ensure the proper and safe recycling methods for each chemistry. As the producer of one-third of the world’s car batteries, Clarios is uniquely positioned to facilitate and spearhead the lithium recycling economy. Clarios has established a world-class closed-loop process where up to 99% of materials from lead-acid batteries can be recovered and turned into new batteries.
KULR Technology Group Inc (NYSEAMERICAN:KULR) has lined up an interesting string of catalysts, but this one could be a game-changer because it deposits the company right at the top in the industry in terms of lithium-ion battery technology, safety, and recycling, the last of which could become the most important emerging theme in the EV space over coming months.
Fisker Inc. (NYSE:FSR) engages in the provision of e-mobility solutions. It develops and manufactures eco-friendly electrically powered vehicles. The company’s products include solar t-shirt, sustainable solar bottle, solar hoodie, and fisker hat. Fisker was founded by Henrik Fisker and Geeta Gupta-Fisker in 2016 is headquartered in Manhattan Beach, CA.
The company also just announced its financial results for the third quarter ended September 30, 2021. Prototype testing and validation of the Fisker Ocean has been underway for some time, with the “Mule 1” build completed and “Mule 2” testing progressing as planned. The prototype Body Shop at the Fisker Ocean assembly facility in Austria is fully operational and production of prototype bodies for the next phase of testing has begun. (Photo: Business Wire)
Fisker Inc. (NYSE:FSR) CEO, Henrik Fisker, stated, “We continued to make rapid progress in Q3 2021 on our core focus, achieving program milestones that ensure we execute Fisker Ocean SUV on-time and with several segment-leading features. We are very excited to provide details and kick off our marketing activities at the L.A. Auto Show two weeks from today.”
“The critical sourcing phase for Fisker Ocean is now largely complete, and we capped that off by announcing a long-term committed battery supply agreement earlier this week. We are now fully engaged with industrialization, including an extensive prototyping phase that has been steadily ramping up. On the PEAR program, we are leveraging the FF-PAD development process and developing unique opportunities for component-sharing that benefits from Ocean development IP and engineering, development, and validation learnings,” continued Fisker.
If you’re long this stock, then you’re liking how the stock has responded to the announcement. FSR shares have been moving higher over the past week overall, pushing about 24% to the upside on above average trading volume. Shares of the stock have powered higher over the past month, rallying roughly 30% in that time on strong overall action.
Fisker Inc. (NYSE:FSR) had no reported sales in its last quarterly financial data, but its operating results were consistent with expectations for the Q3 period and its full-year total spending guidance remains unchanged, according to its recent release. In addition, the company’s Successful Green Convertible Bond offering in August bolstered its cash balance to $1.40 billion as of September 30, 2021, compared to $962 million as of June 30, 2021, putting its balance sheet further into positive territory.
Other key plays in the sustainable EV space include Lucid Group Inc. (Nasdaq:LCID), Lordstown Motors Corp. (Nasdaq:RIDE), and Electrameccanica Vehicles Corp. (Nasdaq:SOLO).
