The smartest electric vehicle (EV) stocks to buy for $1,000 right now

With the right perspective and timing, an investor could have profited enormously from the electric vehicle (EV) sector in recent years. For example, if you invested $1,000 in adze (TSLA 3.91%) when its shares went public in June 2010, you’d be worth more than $156,000 today. Nowadays, many investors are looking Next Tesla. If that’s your goal, pay attention to the two companies on this list.

Looking for the next Tesla? Here it is.

While many investors are looking for the next Tesla, it’s fair to note that it’s still possible to invest in the original Tesla today. The company has a whopping $850 billion market cap, but that shouldn’t stop you from getting in.

There are two reasons to think the stock still has plenty of upside over the long term. First, stocks are cheaper today than they have been in years. This is due to a massive drop in income growth. Earlier this year, Tesla actually experienced a decline in company-wide revenues. As a result, Tesla’s price-to-sales ratio has dropped from the mid-20s to below 10. Sure, it’s still expensive, but it’s a bargain relative to the company’s history.

A cheap valuation on paper, however, is only attractive if you believe the company is about to turn the corner. Take note of the chart below. Tesla has experienced massive declines in revenue growth before, with its valuation typically following suit. A huge reason things turned around was a jump in electric vehicle sales, as well as the introduction of new models like the Model 3 and Model Y — both of which led to sales increases that persisted for several years.

According to Bloomberg, “Deliveries of electric vehicles have been virtually flat since early 2023, and that’s not likely to change anytime soon.” But luckily, Tesla has something else up its sleeve. “Tesla’s robotaxi event next week,” Bloomberg reports, “will see Musk lean even further into the narrative of self-driving vehicles, artificial intelligence and robots.”

Do I agree with Tesla’s robotaxi hype? Not just yet. But Musk dreamed big before. Sometimes it works, and sometimes it doesn’t, but it’s often a smart move to back the horse with a winning record. And despite the company’s recent missteps, Tesla is still the company to bet on if you’re bullish on EV stocks in general. But if you’re looking for the biggest potential, the next stock on this list is for you.

TSLA PS Ratio data by YCharts

This EV stock has huge upside potential

While Tesla is still a great stock to bet on for those bullish on the EV space, its stock is still expensive and the company’s biggest growth days are likely behind it. Rivian Automotive (RIVN -3.15%) is in the opposite situation. Its greatest growing days are many before of it, and shares are not as expensive as you might think.

Earlier this year, for example, Rivian was posting revenue growth rates of more than 80% year-over-year. These growth rates came at a time when Tesla’s revenue base was actually shrinking. And while Rivian’s growth rates have converged with Tesla’s more recently, most of it has come from industry pressure and the maturation of its models.

This year, EV sales forecasts have been repeatedly lowered across the industry, and Rivian’s two existing models, the R1T and R1S, have already been on the market for several years. But everything is about to change.

TSLA PS Ratio data by YCharts

Earlier this year, Rivian announced three new models: the R2, R3 and R3X. All are expected to be priced under $50,000 — the magic price point EV makers must sell below to market to a mass audience. Also, while EV sales in general have slowed this year, most long-term forecasts still predict massive growth in the coming years. Sales of electric passenger vehicles will exceed 30 million by 2027, according to a recent report from Bloomberg. And this figure is expected to increase further to 73 million per year by 2040.

New Rivian models aren’t expected to hit the streets until 2026. That gives plenty of time for market conditions to improve, as most forecasts predict. And in the meantime, investors can lock in a market cap of just $11 billion. This results in a price-to-sales (P/S) ratio of just 2.1 for Rivian versus Tesla’s premium P/S multiple of 8.8.

You’ll need to get comfortable with volatility as Rivian tries to ramp up production capabilities as well as market new models to a consumer base still skeptical of electric vehicles. But if you really want to invest in the next Tesla, the Rivian has all the features you’d want to see.