A renewable energy infrastructure is well on its way to being built. However, patient investors still have time to get involved with green transportation stocks.
Shifting Tides of Energy
Fossil fuels will still be needed for decades to come. Therefore, traditional energy stocks will remain solid investments, particularly for the income generated by their dividends.
However, growth-oriented investors may want to look at green energy investments. At this point, they face a more favorable regulatory environment that will ease adoption. And no matter what the election brings this fall, the sector is quickly reaching a critical mass, if it hasn’t already.
In 2024, the focus of green transportation remains electric vehicles. But investors are starting to see other areas, such as the emerging flying car space. Hydrogen is also gaining momentum, but it still seems like a cost-efficient payoff remains years in the future.
The bottom line is that investing in green transportation stocks is a long-term play. But if you have the patience to wait on the payoff, here are three stocks to consider.
Tesla’s Rocky Road
As of January 31, 2024, Tesla (NASDAQ:TSLA) stock is down more than 20% in 2024. Most of that drop occurred after the company’s disappointing earnings report, which showed a nearly 50% drop in gross margin and threw cold water on the EV outlook for 2024.
So, Tesla’s in a slump. But will it go the way of the Edsel? Unlikely. While the competition catches up, Tesla is forging ahead by developing a less expensive mass-market compact crossover set to start delivery in mid-2025, aiming squarely at the lucrative Chinese market. Despite losing its crown as the world’s top-selling EV company, Tesla remains a benchmark for green transportation stocks.
Soaring with Vertical Aerospace
Looking beyond the EV market, flying cars, or electric vertical take-off and landing (EVTOL) vehicles, are becoming a reality. And Vertical Aerospace (NYSE:EVTL) is one of the emerging publicly traded names in the sector.
While Vertical Aerospace is flirting with delisting and a “going concern” status, their prototype unit, the VX4, has been tirelessly racking up test flights. They are eyeing 2025 for FAA certification for commercial operations. Partnerships with American Airlines and Virgin Atlantic, along with investments from heavyweights like Boeing and Microsoft, signal potential revenue streams. The company must address its financial challenges, but the promise of EVTOL creates a compelling investment case.
Blue Bird’s Electric Journey
Blue Bird (NASDAQ:BLBD) is a niche player among green transportation stocks, manufacturing electric school buses. A recent order for 180 electric school buses from the Los Angeles school district has bolstered the company’s prospects.
With 60% of sales being non-diesel vehicles, Blue Bird holds a significant advantage over its peers. The company’s increasing revenue and earnings, evident in its turnaround from a 23% net loss to a 19% net profit in fiscal year 2023, have pushed BLBD stock up 102% in the last 12 months. The shift towards electric vehicles in the school bus segment bodes well for the company’s future.
