{"id":8259,"date":"2023-05-13T14:23:33","date_gmt":"2023-05-13T18:23:33","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/car-makers-arent-the-only-stocks-to-benefit-from-ev-demand-here-are-3-long-term-picks-that-play-on-the-materials-side\/"},"modified":"2023-05-13T14:23:34","modified_gmt":"2023-05-13T18:23:34","slug":"car-makers-arent-the-only-stocks-to-benefit-from-ev-demand-here-are-3-long-term-picks-that-play-on-the-materials-side","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=8259","title":{"rendered":"Car makers aren\u2019t the only stocks to benefit from EV demand. Here are 3 long-term picks that play on the materials side."},"content":{"rendered":"
\n

If an investor asks for advice on which stocks or sectors to focus on, his or her own opinions about markets and economics might shed light on opportunities. The expected transition to electric cars provides an example. <\/p>\n

The International Energy Agency\u2019s Global EV Outlook for 2023 includes this remarkable statement: \u201cA total of 14% of all new cars sold were electric in 2022, up
from around 9% in 2021 and less than 5% in 2020.\u201d The IEA estimates EVs could make up as much as 18% of worldwide car sales this year, while projecting a 35% share in 2030. That last estimate is based on current government policies.<\/p>\n

\n

Will those policies will change? Do you believe governments around the world will become more aggressive in their push for a transition to EVs? Or might they pull back?<\/p>\n

If you expect the charge toward EVs to continue, one long-term investment focus can be stocks of copper miners. <\/p>\n

Sam Peters, a portfolio manager at ClearBridge Investments in New York, summed up the long-term case for copper during an interview: \u201cEvery EV has about 200 pounds of copper. Electrifying the grid to charge all these cars overnight is very copper intensive. So you have huge draws on copper and very limited supply.\u201d<\/p>\n

Peters co-manages the ClearBridge Value Trust
\n LMNVX,
\n +0.10%<\/bg-quote>
\n and the ClearBridge All Cap Value Fund
\n SFVYX,
\n -0.61%<\/bg-quote>.<\/span>
\n He called Freeport McMoRan Inc.
\n FCX,
\n +1.30%<\/bg-quote>
\n \u201cthe consensus go-to for copper bulls.\u201d<\/p>\n

\u201cif you assume the EV build-outs that the policy makers want, you would be growing copper demand by three million to five million [metric tons] a year on a 25 million supply base,\u201d Peters said. \u201cIt is not going to happen. Visible copper inventories can be tracked. They are as low has they have ever been,\u201d despite the partial shutdown of China\u2019s economy last year, he added.<\/p>\n

Peters is also bullish on oil, especially companies involved in offshore drilling and related services.<\/p>\n

Backing the long-term case for Copper, Jefferies analyst Christopher LaFemina estimated (using data from Wood Mackenzie, company filings and his firm\u2019s own research) that global copper demand will increase at annual rates ranging from 1.9% to 3.7% from 2023 through 2030, while supply will grow at annual rates ranging from 0.7% to 2.7%.<\/p>\n

LaFemina\u2019s estimates for 2022 through 2030 point to a 21% total increase in demand, with an increase of only 16% for supply. He estimates a supply shortfall of 1.3 million tons in 2030.<\/p>\n

You might not have to wait very long<\/h2>\n

Even though the case for copper is long-term, LaFemina has aggressive 12-month price targets for three copper miners. <\/p>\n

He wrote that current share prices for the three copper miners listed below had \u201cpriced in\u201d a copper price of $3.86 a pound \u2014 roughly the current level for front-month copper contracts
\n HG00,
\n -0.08%<\/bg-quote>.<\/span>
\n But based on the companies\u2019 average forward price-to-earnings ratios over the past 10 years and an increase in copper to $4.75 a pound, which he called \u201ca bullish but not unrealistic scenario,\u201d he set the following price targets, which are in local currencies where the stocks are listed:<\/p>\n\n\n\n\n\n\n
\n Company<\/strong><\/p>\n<\/td>\n\n Ticker<\/strong><\/p>\n<\/td>\n\n Country<\/strong><\/p>\n<\/td>\n\n May 8 price<\/strong><\/p>\n<\/td>\n\n Jefferies price target<\/strong><\/p>\n<\/td>\n\n Implied 12-month upside potential<\/strong><\/p>\n<\/td>\n<\/tr>\n
\n Freeport-McMoRan Inc.<\/p>\n<\/td>\n\n FCX,
\n +1.30%<\/bg-quote>\n <\/td>\n		\n U.S.<\/p>\n<\/td>\n\n 36.56<\/p>\n<\/td>\n\n 60<\/p>\n<\/td>\n\n 64%<\/p>\n<\/td>\n<\/tr>\n
\n First Quantum Minerals Ltd.<\/p>\n<\/td>\n\n FM,
\n +2.91%<\/bg-quote>\n <\/td>\n		\n Canada<\/p>\n<\/td>\n\n 36.24<\/p>\n<\/td>\n\n 40<\/p>\n<\/td>\n\n 10%<\/p>\n<\/td>\n<\/tr>\n
\n Antofagasta PLC<\/p>\n<\/td>\n\n ANTO,
\n +1.09%<\/bg-quote>\n <\/td>\n		\n UK<\/p>\n<\/td>\n\n 14.70<\/p>\n<\/td>\n\n 22<\/p>\n<\/td>\n\n 50%<\/p>\n<\/td>\n<\/tr>\n
\n Source: FactSet<\/p>\n<\/td>\n<\/tr>\n<\/table>\n

Click on the tickers for more about each company or index.<\/p>\n

Click\u00a0here\u00a0for Tomi Kilgore\u2019s detailed guide to the wealth of information available for free on the MarketWatch quote page.<\/p>\n

Mining stocks tend to be volatile \u2014 this isn\u2019t the type of investment to consider if you cannot wait through price swings<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

If an investor asks for advice on which stocks or sectors to focus on, his or her own opinions about markets and economics might shed light on opportunities. The expected transition to electric cars provides an example. The International Energy Agency\u2019s Global EV Outlook for 2023 includes this remarkable statement: \u201cA total of 14% of […]<\/p>\n","protected":false},"author":1,"featured_media":8260,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-8259","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"\nCar makers aren\u2019t the only stocks to benefit from EV demand. Here are 3 long-term picks that play on the materials side. | iFintechWorld<\/title>\n<meta name=\"description\" content=\"If an investor asks for advice on which stocks or sectors to focus on, his or her own opinions about markets and economics might shed light on\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ifintechworld.com\/?p=8259\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Car makers aren\u2019t the only stocks to benefit from EV demand. 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