2020 was a very good year for electric vehicle (EV) stocks. Shares of EV giants such as Tesla (TSLA) and NIO (NIO) were up a staggering 743% and 1,110%, respectively, in the last year as investors were betting on the accelerated shift towards clean energy solutions to drive top-line growth in the upcoming decade.
While Tesla and NIO are established players in the EV space, there are several other companies that are just revving up their engines and getting started in a disruptive but high-growth industry. Here, we take a look at three little known EV stocks that are trading below $10, including Kandi Technologies Group (KNDI), Canoo Holdings (GOEV) and Electrameccanica Vehicles (SOLO).
Valued at a market cap of just $473 million, Kandi Technologies manufactures and distributes EV products and parts as well as off-road vehicles in China and other international markets. In addition to off-road vehicles, the company also offers all-terrain vehicles, utility vehicles, go-karts, electric scooters and electric self-balancing scooters.
Shares of Kandi Technologies are trading at $6.20 and have almost doubled in the past 12 months. In the first quarter of 2021, its revenue soared 150.7% to $16 million compared to $6.4 million in the prior-year period. Sales of its EV parts were up 206% at $6.4 million while off-road vehicle sales rose 39.2% to $5.6 million in Q1. Comparatively, electric scooters and associated parts sales were $3.9 million.
The company also managed to end the quarter with a gross margin of 27.3% significantly higher than the prior-year figure of 18.3%. Its net loss was $6.4 million or $0.08 per share due to research and development investments. Its net loss in Q1 of 2020 stood at $1.6 million or $0.03 per share.
Analysts tracking the firm expect sales in 2021 to rise by 57% to $121 million indicating a forward price to sales multiple of 3.9x which is reasonable.
A mobility technology company valued at a market cap of $2.38 billion, Canoo Holdings designs, engineers, develops and manufactures electric vehicles for commercial and consumer markets in the U.S. It offers B2B delivery vehicles, multi-purpose delivery vehicles and lifestyle vehicles by leveraging skateboard architecture technology. Canoo stock is trading at $9.56 and is down 7% since June 2020.
Canoo is still pre-revenue and in Q1 the company reported an operating loss of $97 million. It ended the quarter with $642 million in cash which means it has enough runway for over six quarters given the current burn rate. However, it will have to raise additional capital sooner as Canoo should pump in millions of dollars in research and development.
In Q2, the company has forecast operating expenses between $65 million and $75 million while CAPEX is forecast between $45 million and $55 million. Canoo’s Lifestyle Vehicle is all set to launch in 2022 and will be priced from $34,750 to $49,950.
ElectraMeccanica is trading at $4.41 per share and valued at a market cap of $530 million. Similar to Canoo, ElectraMeccanica is a development stage company that manufactures and sells EVs in Canada.The company’s flagship product is the SOLO which is a single seat vehicle. It is also developing the Tofino, an all-electric two-seater roadster.
In Q1, ElectraMeccanica reported an operating loss of $8.9 million compared to a loss of $5.1 million in the prior-year period. Its general and administrative expenses stood at $2.8 million while research and development expenses were $2 million.
The company’s CFO Bal Bhullar said, “Ending the quarter with more than $260 million in cash provides us with the capital to not only execute on nearer-term initiatives like expanded production and our U.S. based assembly facility and engineering technical center but also to invest judiciously into R&D for the road ahead.”