ETF Securities' top 5 future mobility stocks
Global transport is changing at breakneck speed, rushing to meet the demands of global warming.
Electric cars — unheard of just five years ago — are now almost everywhere, while ships and aircraft are increasingly looking to move to hydrogen power.
Below we look at the top five stocks powering the future of mobility.
Rolls-Royce (London: RR) is a byword for quality. Whether it's aeroplane engines or premium cars, the brand name has serious connotations, but Rolls-Royce is increasingly moving into more futuristic areas, like luxury electric cars. Rolls-Royce has announced it will go fully electric by 2030, bringing much of the ultra-premium end of the car market with it. Perhaps more interestingly, Rolls-Royce recently built the world’s fastest all-electric plane.
The first and last name in the future of driving, Tesla (Nasdaq: TSLA) is more than just a car maker. It is also a battery company, self-driving software business, Uber challenger, clean energy company, robotics company, and space company thanks to the link with SpaceX. It is hard to think of another business that rolls so many future themes into one. With its revenue growing at 50% a year, its order book full, and its competitors unable to sell electric cars profitably, the company can justify a high valuation.
China’s competitor to Tesla, BYD (Shenzhen: 002494) makes electric cars and makes them cheap. It holds a near monopoly position in electric car taxis in China. It also makes other kinds of electric-powered vehicles, including forklifts and bikes. Increasingly, it has been branching out into other parts of clean energy too, such as solar panels. Warren Buffet’s Berkshire Hathaway owns a 25% stake.
4. Pilbara Minerals
You cannot have electric cars without batteries, and you cannot have batteries without lithium, and you cannot have lithium without lithium miners. Simple as that. Pilbara (ASX: PLS), the West Australian lithium specialist, is a global success story. Thanks to surging demand for batteries and electric cars, Pilbara’s revenue doubled from 2019 to 2020, and doubled again from 2020 to 2021. Surging revenue, and its inclusion in the ASX 200 in March, have helped its share price shoot up 213% year-to-date.
This Korean giant makes pretty much everything in its home country — from microwaves to ships. They even make ETFs, but most crucially, Samsung (Korea: 005930) is one of the largest semiconductor and battery companies in the world. As the world’s premier memory silicon chip maker, car makers are using its products to help power self-driving software, which requires a lot of computer power. Its batteries are being added to electric vehicles.
Access via ACDC
For those wishing to invest in the future of mobility, the ETFS Battery Tech & Lithium ETF (ASX: ACDC) offers one solution. It invests in the battery technology and lithium mining supply chain, which crucially includes electric cars. It holds all the stocks above.
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Kanish Chugh is responsible for distribution covering sales and marketing strategy for institutional, intermediary and retail clients. He joined ETF Securities in 2015 and has previous experience with Fidelity International, BlackRock and...