Electric Vehicle Stocks to Buy – Tesla vs Nikola vs NIO Analysis

by birtanpublished on October 2, 2020

I think we'll all be aware of the impact um electric cars have had on the world in recent years um plus of course the performance of the companies behind them none more so than tesla here's here's the tesla share price chart going from um 400 a share from the march lows to um almost 2 300 at the time of recording so an incredible performance so in this video we'll take a look at tesla and a couple of other shares as well and see where the opportunities might be so before we get into it a quick look at tesla great success story very popular

Uh amongst investors around the world also amongst um online investors uh obviously it's almost like a cult behind tesla and that has been um very well rewarded as we've seen the share price continue to push higher um just earlier this week we had uh the ipo of a chinese um electric car company spang came to the market i'm sure i'm not pronouncing that correctly let's just bring up their price so you can trade this one with us but at the moment we don't have that much data to go on so just a day's worth

Of data so we won't be looking at this one in too much depth but we will be looking at one other chinese ev company before we get into it in more detail we do have an electric cars index that if you're a client with us you can trade or invest on depending on your time frame and it's made up of um tesla nikola and neo the three companies i'm going to talk about uh today so um different ways of getting exposure this sector but let's let's kick things off let me talk a bit

About one of these companies then we'll come back and look at it in more detail hello i'm david jones from capital.com and i thought um we'd do another one of our slightly different videos and we'll take a look at some uh the shares the performance and the potential future prospects of three i suppose major or not so major electrical vehicle manufacturers so in this video we'll do the usual go through some details about them then we'll jump on on the chart onto the platform see if there's a trade

Uh to be done then go back talk about some more and flip backwards and forwards if you're watching this and you haven't subscribed if you could subscribe it helps grow the channel and means we can continue to push out lots of interesting content also uh on friday the first friday in september we are doing a live broadcast over the non-farm payroll so if you're subscribed and notified uh you'll get notified of that as soon

As it happens and we'll see how markets react to the latest u.s uh employment fees so let's kick things off and where else to start uh but with tesla i suppose seen by some people as something of still a young upstart type company but but clearly you know the granddaddy really of the electric vehicle market it was started uh back in 2003 and by the end of 2019 it had a 23 share of the battery electric vehicle market we can reel off lots of impressive numbers

Uh about tesla but just another one the first half of 2020 tesla accounted for 81 of um electric battery vehicles sold in the usa on the first of july this year it became the world's most valuable um car company by market capitalization clearly a function of its share price going up its market cap was in excess of 200 billion dollars which made it worth more than toyota uh the previous car company that was the largest in the world i think one of the things that's really

Helped tesla is the infrastructure um that it has i think it you know charging vehicles is still a worry uh for many of us you know me included and we have the worries about if we're doing a long trip are we going to be able to charge it of course tesla have um 15 000 superchargers and actually probably more by now um around the world so they've done a great job of having this infrastructure meaning it's very easy and quick um to charge your car and that's something i think

That a lot of the other car manufacturers electric car manufacturers don't yet have so it's a massive plus point for tesla this infrastructure but i think it's interesting clearly with the growth in popularity of electric vehicles is tesla going to start to feel the squeeze as the more traditional car manufacturers continue to muscling on this area you know the likes of um vw audi hyundai kia and of course um even porsche with their uh their brand new taken tyco

Uh however you pronounce it uh supercar so i do wonder you know tesla's done a fantastic job of building this sector out are they going to feel the squeeze or actually will they continue uh to dominate and see be seen as the real innovator uh in this section i think it's going to be a really interesting few years and we've seen some of these new challenges um just just in july actually in europe the renault zoe was the best-selling uh electric vehicle

In july so some of these what are seen as perhaps upstarts in the electric vehicle market are maybe starting to make small inroads but it hasn't affected the tesla share price let's just take a look at tesla and see where the opportunity could be so let's kick things off with um with tesla i think what's interesting here is um if you if we look at the longer term chart or the la the last few years that's three years or so everything that's gone before this year is almost dwarfed into insignificance

Massive volatility this year nearly hit a thousand dollars earlier in the year thousand dollars a share sales off of course in march with everything else and we saw stock markets uh really heavily hit and since then has just just pushed higher so it has gone from 400 below 400 briefly in march to almost 2 300 um now so let's zoom in on this trend i think the last tesla video i did um i put an order in to buy uh around about was it eleven hundred twelve hundred dollars i think that sort

Of level and um missed out and of course this is this is the problem i think if we have um strong trending markets and you're waiting for a pullback to get in the trend you get an better entry point and uh better risk reward but you do run the risk of missing out on the move and and this is what's happened here you know we've got lots of support for tesla coming in on the trend around 1400 that train line's done a great job

Off those march those march lows so for me as long as it holds sort of you know 13 to 1400 if we did see a steeper sell-off you know that that trend still looks still looks valid to me so i'm happy to be a buyer on any dips if we look at the 10-day rsi down here i don't think it's really telling as much this 10-day rsi um it went um extreme mid august when the price sort of crossed through sixteen hundred dollars uh clearly the price is headed up since

Then in strong trending markets as i often say you can get wrong footed by these indicators they'll tell you to go one way and the market just carries on going as it was before so i don't think the rsi is adding too much here and i think it's really very much a price driven trade it's either sit and wait for a dip see if we get one dips over the last couple of weeks have been fairly short-lived as you can see or bite the bullet and buy in buy into

Strength and that's what i'm gonna do if i look at the most recent high uh 22.95 says 2 295 dollars a share um i'm going to buy in i'm going to buy in on a break of 2300 so if it moves a few dollars higher than where is now i'm going to jump back on to the momentum so what i'll do i'll set an order in to buy at 23.10 when it comes to stop losses the previous high was around eighteen hundred dollars mid-july highs so i'll set my stop at eighteen hundred so you know i need to give it room to

Move around because it's a volatile stock um i'm not expecting in the moment if the momentum is going to continue through two thousand three hundred a big off pull pull back back to 1800 so let's just uh set that up so as it's a big stock i can trade a fractional position here so i've gone for 0.5 i'm going to buy 0.5 because it fits with my risk management i'm going to buy if the price gets to 23.10 if that order gets filled um put a stop loss in at 1800 and um my risk as usual on these trades

Is around a couple of hundred pounds so 191 pounds risk if that gets filled at 23.10 and that order will just sit there and if if uh tesla strengthens from here i'll get put in uh when 2310 gets broken let's place that order and uh see what happens next but clearly the trend is is still up uh for tesla like i say you know we've got a great trend going on since those march lows happy to be a buyer in dips if they happen the next company we're going to talk

About is um neo again recently floated uh on the stock market they were set up in china in 2014 so um much younger much newer to the game than tesla and they've also done a good job i think on infrastructure as well they have a network of battery swapping stations in china so you drive in and rather than charging up the battery in your car gets uh gets swapped out so it has been very much chinese focus but it does have plans uh to enter new markets including europe uh in the second half

Of 2021 so again it's going to be really interesting as these companies maybe branch out their domestic markets and how things work internationally in the second quarter of the year it delivered 10 900 vehicles small perhaps compared to traditional car companies and the likes of tesla but still up 190 from the same period in the year before if we look at the valuation it's around six times

Its revenue so if you look at the valuation of the company six times its sales that's how it's being valued which isn't too ridiculous i think if you take a look at tesla and value it based on its revenues or expected revenues uh then it's about seven times so in a valuation on a revenue point of view pretty much the same as tesla and of course electric vehicles hot sector for the stock market and uh neo shares are up uh more than five-fold since the end of april this year let's

Take a look at their share price chart so here's um here's neo only been around since um earlier this year similar trajectory to uh tesla over over recent weeks i think what's interesting with neo uh you know i'm not gonna look at the rsi because i think in in the strength like this it's pretty meaningless as i said with tesla uh punched up to a high the 13th of july up around 16.40 a share sales off a bit almost back um to um well 10.40 was that was the

Sell-off so you know again really volatile but has broken through in the last couple of days which is an interesting one you know we're getting the breakout now in the air um so for me on this one i think i'd be happier waiting i think there's definitely an argument for buying now because the strength obviously but we're only a couple of days into the breakout so perhaps the more cautious approach here is to wait to see do we get a sell-off and then do we get a recovery back up and look to jump on board it then

With a better a better stop-loss but clearly another one where the trend is still up you know looking looking something like that coming in around 14 at the moment um you know any pullbacks from here i'd still be looking to be a buyer and maybe looking for a better place for stops i think probably the ideal place for a stop for me would be the other side of what are only the lows from about six weeks ago the other side of 10.40 but an interesting one to watch i think over the next few days

To see how it performs after this breakout so i'm going to be a bit more patient on this one and finally let's talk about nicola founded in 2014 and named after um nicola tesla not surprisingly someone taking his christian name after his surname have been used already nikola tesla of course best known for his uh contributions to the design of the aec power supply so this company is focusing on a slightly different area of the market it's looking at

Zero emission trucks so powered by batteries like the other companies we've been talking about but also hydrogen powered as well and recognizing how important once again the infrastructure is nicola plans to uh invest and build out a series and a network of hydrogen filling stations but with this company none of these vehicles are yet in production so this is an interesting one so you could view it as a bet on a potentially great future or actually

A great idea and will we ever see it materialize or do we go the other way so i think it's an interesting play when it comes to their shows and of course tesla plans to launch its own electric truck i think we've all seen it uh in the in the tesla sort of grand reveals and that's coming out in 2021 so they are going to fail some competition uh nicola here if they do get around to building one uh by that time period but let's take a look let's take a look at their share

Price because i do wonder here if maybe the story for their shares is a somewhat different one to the two other companies and uh and finally nicola we don't have a lot of data on this it's only been trading since um mid-june so we've got a couple of months worth of data on this it's interesting though isn't it that if you look at the performance of tesla and neo moving higher nicola going completely opposite direction so perhaps investors are still wary you know because we don't have a product yet

Maybe investors are a little bit wary and i might be tempted to go short here perhaps not at the current levels um i think there's an argument for going along all going short if you really wanted to buy them for me there's an obvious place for a stop the other side of these lows uh around what is it 2920 that sort of area or 29 is maybe a better level the lows here end of july uh they're currently trading at 39 ahead of the market open but for me i'd be quite tempted to go

With admittedly a very short-term trend but to try and get short into any strength so i i might what i'm going to do put an order in to sell if they get up to 45 dollars a share look to sell short and put a stop i think perhaps the other side of these early july highs early july highs were about what 60 dollars actually that's quite a wide stop so i might um adjust my stop there actually because

That is 30 away so if i'm a seller at 45 let's put a stop above this this high 15th of july 55.51 let's go 57 so i'm going to sell up 45 with a stop at 57. that's still a pretty wide stop um obviously but with the volatility uh with these sort of stocks you know i need i do again want to give it room to try and prove me right so i'm going to sell 22 if the price gets to 45 if 45 gets filled put a stop loss in at 57 and that's my usual risk of 198 pounds

So i'm doing this ahead of the market open so i'll place that limit order and we'll see how that one works out and just a quick look here are the orders uh down here the two latest orders are placed you can see there's a few uh older orders in there that might need some pruning but there's that the tesla order uh and below that is the nikolai order as well so let's see um how they fare that's it for this update it's going to be a really fascinating

Sector to watch i think over the next few years don't forget you can also trade that that effective that basket that electrical vehicle basket with us as well but from me david jones and capital.com we'll leave things there good luck with your trading for more trading videos just like this please subscribe to our channel

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