Batteries are the backbone of the technology realm, propelling everything from smartphones to electric vehicles. Evolving from standard alkaline cells of yesteryears, lithium-ion batteries now reign as the powerhouse fueling cutting-edge devices globally. The U.S. alone boasts a gargantuan $44.5 billion in the lithium-ion market, anticipating a robust 13.1% Compound Annual Growth Rate (CAGR) over the next decade.
Embarking on an investment journey in the battery sector reveals its pivotal role across diverse industries. Here are three undervalued battery stocks as we step into the breezy month of June.
The Tesla Spark (TSLA)
Envisioned as the planet’s premier electric vehicle architect in market capitalization and annual sales, Tesla (NASDAQ:TSLA) has faced strife this year, enduring a near 30% decline in stock value amid consumer apprehension tied to rising interest rates and inflation. Nonetheless, undeterred analysts maintain bullish price targets, with a lofty 60% surge projected to a street-high of $296.25.
Debating Tesla’s essence oscillates between valuing it as an automaker or a tech phenomenon. Venturing beyond its upcoming Cybercabs to the Optimus Bot AI, Tesla transcends the automotive realm. Progressing in the battery arena, Tesla unveils promising innovations, such as potential sodium-ion batteries speculated to halve energy storage costs compared to lithium-ion counterparts. Though nascent, this alternative could revolutionize EV affordability, enhancing Tesla’s domination in the market.
Trading at approximately 6.5x sales or 71x forward earnings, Tesla presents a historical stock low. The company is poised to redefine future landscapes, promising substantial growth potential once the tides turn.
The NextEra Surge (NEE)
NextEra Energy (NYSE:NEE) stands as the globe’s prime wind and solar energy producer, commanding the reins in renewable energy storage. Reflecting investor optimism, the stock marginally exceeds its average price target of $74.59, aiming for a 30% ceiling at $102.80.
