Institutional investors and professional traders rely on The Fly to keep up-to-the-second on breaking news in the electric vehicle and clean energy space, as well as which stocks in these sectors that the best analysts on Wall Street are saying to buy and sell.
From the hotly-debated high-flier Tesla (TSLA), Wall Street's newest darling Rivian (RIVN), traditional-stalwarts turned EV-upstarts GM (GM) and Ford (F) to the numerous SPAC-deal makers that have come public in this red-hot space, The Fly has you covered with "Charged," a weekly recap of the top stories and expert calls in the sector.
TESLA DELIVERIES: Tesla reported third quarter deliveries of 343,830, with 3% subject to operating lease accounting, and production of 365,923 vehicles. Tesla delivered 18,672 Model S/X and 325,158 Model 3/Y. The company said that, "Historically, our delivery volumes have skewed towards the end of each quarter due to regional batch building of cars. As our production volumes continue to grow, it is becoming increasingly challenging to secure vehicle transportation capacity and at a reasonable cost during these peak logistics weeks. In Q3, we began transitioning to a more even regional mix of vehicle builds each week, which led to an increase in cars in transit at the end of the quarter. These cars have been ordered and will be delivered to customers upon arrival at their destination."
Commenting on the numbers, Wedbush analyst Daniel Ives noted that Tesla's third quarter deliveries of 343,000 units for the quarter missed the Street's 364,000 estimate. Production was 365,000 in the quarter. The analyst pointed out that "clearly" Tesla had some delivery challenges in the quarter with some isolated soft spots in China. While the reasoning from Tesla makes sense on paper, the Street will not be convinced and lingering worries about demand issues will persist until it hears around year-end unit guidance on Tesla's conference call October 19th, Ives argued. He believes the unit set-up into Q4 is very robust and could approach massive numbers that are in the 475,000-plus range. In a nutshell, this quarter was nothing to write home about and the Street will be disappointed by the softer delivery number in the third quarter, the analyst contended. That said, he views this more of a logistical speed bump rather than the start of a softer delivery trajectory into Q4/2023 and remains bullish on the Tesla story. He has an Outperform rating and a price target of $360 on the shares.
LI AUTO SEPTEMBER DELIVERIES: Li Auto (LI) announced that the company delivered 11,531 vehicles in September 2022, up 62.5% year over year. The deliveries included 10,123 Li L9s, the company's six-seat, flagship smart SUV for families, in its first full month of deliveries. The September delivery brought the Company's third quarter deliveries to 26,524, representing a 5.6% year-over-year increase. The cumulative deliveries of Li Auto vehicles reached 211,015 as of the end of September.
BUY RIVIAN: Truist analyst Jordan Levy initiated coverage of Rivian Automotive with a Buy rating and $65 price target. The company has only started delivering its vehicles, but investors will soon see Rivian not just as an EV manufacturer but as a "next generation diversified mobility tech powerhouse", the analyst told investors in a research note. The company's experienced management should not be overlooked as CEO RJ Scaringe has assembled a team whose expertise spans a broad range of business segments, Levy added, further stating that in its partnership with Amazon.com (AMZN), Rivian not only has a strategic advantage over EV competitors but also a better position to compete with incumbent OEMs in the commercial market.
BULLISH ON LUCID: Cantor Fitzgerald analyst Andres Sheppard initiated coverage of Lucid Group (LCID) with an Overweight rating and $23 price target. Sheppard believes Lucid's luxury and premium vehicles provide greater efficiency, longer range, faster charging, and more space relative to its peers, the analyst told investors in a research note. The analyst is modeling Lucid conservatively capturing a 2% market share of the Global EV market by 2026.
COMMERCIAL EV BATTERY NICHE: Truist analyst Jordan Levy initiated coverage of Proterra (PTRA) with a Buy rating and $9.00 price target. The company is carving out a valuable niche that provides specialized battery and electrification technologies purpose-built for a broad-range of commercial vehicle classes, the analyst told investors in a research note. Concurrent with the startup of Proterra's multi-GWh battery facility later this year, the commercial EV market has reached an inflection point that is further bolstered by recent supportive policies which should drive "unprecedented demand" for years to come, Levy added.
The analyst also started QuantumScape (QS) with a Hold rating and $10 price target. The company has become a leading name in the rapidly growing EV battery industry space and has generated interest from numerous auto OEMs, including a multi-year JV with Volkswagen, the analyst contended. Levy added, however, that while QuantumScape batteries could eventually come to play a significant role in advancing EV performance and costs, he sees "limited near-term upside" in the current market backdrop and given that commercial volumes remain "years away."
LEADERSHIP POSITION: B. Riley analyst Christopher Souther initiated coverage of Lion Electric (LEV) with a Buy rating and $5 price target. The analyst has confidence in Lion's ability to maintain a leadership position in the "growing" electric medium- and heavy-duty vehicle market. Lion sees a "vast" $110B annual total addressable market across the U.S. and Canada in medium- and heavy-duty electric vehicles, which should be bolstered by policy initiatives in both countries, Souther told investors in a research note. He believes the company's "first-mover advantage will prove a differentiator" as governments accelerate their efforts to electrify their economies.
BUY IVANHOE ELECTRIC: Raymond James analyst Farooq Hamed initiated coverage of Ivanhoe Electric (IE) with an Outperform rating and $12 price target. Ivanhoe Electric represents a unique offering among copper explorers and developers combining access to large potential copper projects in historically prolific mining jurisdictions in the U.S. with proprietary geophysics exploration technology that could allow for better target generation making exploration drilling more cost-effective, Hamed told investors in a research note. These assets benefit from being under the "Ivanhoe" banner with Chairman and CEO Robert Friedland, given his track record of finding and developing large mineral deposits and ability to finance these projects, the analyst added.
IRA BENEFITS: Evercore ISI analyst Sean Morgan upgraded First Solar (FSLR) to Outperform from In Line with a price target of $150, up from $88, citing his view of the Inflation Reduction Act as a positive catalyst to increase domestic production and perhaps begin to shift the consumption patterns of utility solar module supply in the U.S. On the supply side, he expects First Solar could generate about $0.17/watt of solar PTC benefits, Morgan added.
PULLBACK CREATES OPPORTUNITY: Northland analyst Abhishek Sinha initiated coverage of Sunrun (RUN) with an Outperform rating and $60 price target, calling it a "high-quality business with very strong and dependable cash flows." The multi-channel business is "ready to burgeon" driven by growing solar demand supported by the Inflation Reduction Act, Sinha told investors. A recent pullback in the market provides a "great opportunity" for investors seeking residential solar market exposure but had missed the stock run that followed the passage of the IRA bill, Sinha added.
BULLISH ON JINKOSOLAR: HSBC analyst Daniel Yang initiated coverage of JinkoSolar (JKS) with a Buy rating and $76 price target. The analyst called the company a leading solar producer in shipments, overseas networks, and vertical integration. Jinko is leading the race to switch to a new technology and will also benefit from surging demand and lower poly prices, Yang added.
CHARGING STATIONS: Hertz (HTZ) and bp (BP) announced the signing of a memorandum of understanding, or MOU, for the development of a national network of EV charging stations powered by bp pulse, bp's global electrification and charging solution brand. "The MOU sets the foundation for Hertz and bp to drive the future of mobility and accelerate EV consumer adoption. The agreement also involves the management of Hertz's charging infrastructure by bp pulse and the customization of its Omega software to ensure Hertz's growing fleet of electric rental cars are recharged quickly and efficiently between rentals. Omega supports fleet operations by automating charging when the power price is low, while providing real-time visibility to EVs, chargers, power usage, and more," the companies stated. Stephen Scherr, Hertz CEO, said: "Hertz is accelerating the adoption of electrification by investing in the largest rental fleet of electric vehicles in North America and expanding the availability of charging stations. We are excited to partner with bp pulse to create a national charging infrastructure for the Hertz EV fleet, thereby growing the number of charging options available to our customers and providing them with a premium electric experience and lower emission travel options."
ENDURANCE PICKUP TRUCK: Lordstown Motors (RIDE) announced the production of two Endurance EV pick-up truck units, with a third unit to be completed shortly. The units were built at the Foxconn Ohio plant.
Lordstown expects to build up to 500 salable EVs. Fifty EVs are scheduled for delivery to customers in 2022, and the remaining units will be shipped in the first half of 2023. The latest production forecast will depend on supply availability and the company’s ability to raise capital.
