The 3 Best EV Stocks to Buy in August 2024

Some of the best electric vehicles (age) stocks seem to run out in August. Undoubtedly, selling in the broader tech market has been pretty tough among EV plays as recession fears could further dampen demand for such big purchases. While a harder-than-expected landing would certainly weigh on car demand, there are certain names in the EV scene that can win out over the competition.

indeed adze (NASDAQ:TSLA) is no longer the only EV playback. While Elon Musk’s storied firm has managed to steer clear of the devastating pitfalls that many emerging rivals have fallen into, the stock remains in the midst of a historic crucible. As new competitive threats emerge as consumers turn to hybrid options or more affordable all-electric vehicles, Tesla may no longer be the go-to option for investors seeking EV exposure.

Either way, let’s check out three bruised EV stocks that might be getting too much negativity.

Tesla (TSLA)

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It didn’t take long for Tesla’s early summer stock meltdown to melt down in violent fashion. The EV giant’s big (delayed) robotaxi day is two months away, but the excitement and anticipation seem to be as well-founded as they’ve been since the event was announced. This is largely due to last week’s lackluster jobs numbers, which sent most stocks down in a hurry.

More recently, the jobless number came in below expectations, allaying recession fears that have built up in recent sessions. In response, TSLA shares rallied 3.7% alongside the rest of the market as recession jitters eased. Despite an upbeat Thursday, the name is down 7% over the past week and more than 22% over the past month.

At 55.7 times price-to-earnings (P/E), Tesla isn’t exactly a cheap electric vehicle stock, but it’s still one of the best. If no recession materializes, TSLA stock looks like the Magnificent Seven stock that might have the most room to run.

BYD (BYDFF)

Source: shutterstock.com/Trygve Finkelsen

BYD (OTCMKTS:BYDDF) is a Chinese manufacturer of electric vehicles that Berkshire Hathaway (NYSE:BRK-ANYSE:BRK-B) recently reduced to less than 5% of the conglomerate’s public share portfolio. Berkshire has certainly taken profits in a wide range of firms of late, sparking fears that Warren Buffett may be preparing for a painful market selloff.

While Buffett didn’t address why his firm is reducing its stake in BYD, I think it would be a mistake not to go after Berkshire’s name, while it’s down more than 14% from its 52-week high and nearly 35% of the total… high time.

At these depths, the electric vehicle stock trades at just 18.3 times P/E, well below Tesla’s. That’s not a bad price to pay for an electric vehicle company with a CEO (Wang Chuanfu) who the late Charlie Munger praised as a “natural engineer” and a genius.

If there is one firm that can lead Tesla in the coming years, it should be BYD. The Chinese electric vehicle maker is expanding rapidly in Asia, even in the face of macro uncertainties. Arguably, keeping one foot on the gas may be the best course of action as the firm tries to increase its market share.

Rivian (RIVN)

Source: Roschetzky Photography / Shutterstock.com

Finally, we have Rivian (NASDAQ:Exactly), which is starting to gain traction after spending the past few weeks steadily dropping. Interestingly, RIVN shares rose nearly 7% on Thursday, regaining most of the ground lost the previous day after the firm fell short of quarterly estimates.

Despite posting a bigger loss per share for the quarter, investors appear more focused on sales, which are heavily dependent on a healthy economy. Management sees full-year production holding steady at 57,000 vehicles, about 1,000 vehicles more than analysts think the firm can sell this year.

If the economy goes downhill from here, achieving such sales targets will become incredibly difficult. Like Tesla, Rivian vehicles aren’t cheap, which makes them more sensitive to the state of the economy and consumer mindset.

All things considered, the latest post-earnings looks more “mixed” than anything, at least according to Baird’s Ben Kallo, who has a $20 price target on the stock, which is currently trading at just 15 dollars per share.

At press time, Joey Frenette held a long position in BRK-B. The opinions expressed in this article are those of the writer, subject to InvestorPlace.com Publishing Guide.

At the time of publication, the responsible editor had (either directly or indirectly) no position in the securities mentioned in this article.