Prediction: This EV Stock Will Be the Best Performer the Rest of 2024

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• Electric vehicles (EVs) were supposed to be the next big thing. Yet, their sales have been disappointing.
• Wall Street still has big expectations, though, especially for Nikola Corp. ( NASDAQ: NKLA ).
• Also: Discover the next Nvidia .

Electric vehicles (EVs) were supposed to be the next big thing. Major automakers and tech companies invested billions of dollars in the technology. Many startups appeared. However, sales of EVs have been disappointing for a while, and some of those startups have disappeared. Even Tesla Inc. ( NASDAQ: TSLA ) has had to cut prices. Is there no hope, at least for investors? Note that Morgan Stanley recently picked Tesla as its top stock pick among U.S. automakers. Overall, Wall Street sees plenty of upside potential in the industry. Here are some of the EV-related stocks for which analysts have big expectations. (Note that Tesla isn't one of them.)

Topping that list is Nikola. Analysts anticipate the share price has lots of room to run. Does that mean the stock is undervalued? Or has one overzealous analyst skewed the mean?

Why Invest in Nikola?

Are shares poised for a rebound?

Nikola stock is down about 99% from its 2020 initial public offering (IPO) share price. Most of that retreat occurred in the past two years. The company's stated mission is to mission is to create solutions for a zero-emissions world by transforming commercial transportation. It has faced some challenges, including its founder and former CEO's conviction for fraud. However, the company was awarded Arizona Forward's Environmental Excellence Award for Technology Innovation earlier this year. Shares traded for above $240 apiece not long after the IPO. In the past month, the stock has popped about 9% to about $9 a share. Is this the start of a rebound? What does Wall Street expect?

Nikola, the Company

A maker of emissions-free vehicles.

This technology innovator and integrator engages in the provision of zero-emissions transportation and infrastructure solutions. It designs and manufactures heavy-duty commercial battery-electric and hydrogen-electric vehicles, electric vehicle drivetrains, vehicle components, energy storage systems, and hydrogen fueling station infrastructure. Its products include the Nikola Tre Class 8 truck. Additionally, the company assembles, integrates, and commissions its vehicles in collaboration with its business partners and suppliers.

Nikola headquarters are in Phoenix, Arizona. The company was founded in 2015, and it went public in the summer of 2020. Competitors include the aforementioned EV makers and truck makers such as PACCAR Inc. ( NASDAQ: PCAR ), REV Group Inc. (NYSE: REVG), and Wabash National Corp. (NYSE: WNC).

Look for Nikola's second-quarter report on August 9. It already said it wholesaled 72 hydrogen fuel cell trucks in the period, beating guidance estimates. Some recent job listings suggest optimism at the company, but it also recently had a reverse stock split . In the first quarter, it narrowed its net loss and said its Hyla refueling network was expanding. Still, sales numbers disappointed.

Nikola, the Stock

Poised for a rebound from that all-time low?

The share price hit an all-time low of $7.25 after the reverse stock split, and it is now over 65% lower than at the start of the year. The Dow Jones industrials are up more than 8% year to date. Note that the $29.00 consensus price target is well above the current share price but far below the 52-week high.

Only three of eight analysts who follow the stock recommend buying shares. D.A. Davidson maintained its Neutral rating back in June, but there have been no notable analyst calls since the stock split. Institutional investors hold about 32% of the shares. Vanguard and BlackRock are among the top holders, though their stakes are well less than 1%. More than 41 million shares, or around 23% of the float, are held short. Note that CEO Stephen Girsky bought a million shares back in May.

Where Is It Headed?

A stock with no downside?

Wall Street expectations for where the stock goes in the next 52 weeks vary but are all positive. Not only does the high price target suggest huge upside potential, but so does the consensus target.

With the stock not far off an all-time low, what's with the enthusiasm for the stock? “We have maintained our 2024 momentum with solid wholesale numbers, new customers such as Walmart Canada, and repeat customers like 4GEN and IMC, purchasing vehicles through our dealer network,” said Nikola's CEO . The company will have to keep up the momentum to stay ahead of the ongoing speculation about potential bankruptcy. There has been some discussion about whether Nikola will have to sell shares again to raise more cash. Analysts are cautious when it comes to their ratings, yet they see plenty of upside potential.

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