Aug 05, 2021 (WallStreetPR via Comtex) -- Within the EV space, the companies that position themselves as integral to the supply chain for producing and catering to electric vehicles represent a powerful secular growth theme. One of the most important subgroups in that equation is companies involved in producing and improving batteries.
According to recent research from Technavio, "The advances in EV batteries and associated technologies will offer immense growth opportunities. To leverage the current opportunities, market vendors must strengthen their foothold in the fast-growing segments while maintaining their positions in the slow-growing segments."
Technavio's report calls for incremental growth adding another $38 billion in annual activity in the EV battery marketplace between 2021-2025.
According to a report by the U.S. Department of Energy, analysts believe the mobility storage demands in 2030 will reach 0.8 to 3.0 TWh, driven by light EVs, which represents a massive jump from current levels and will require an enormous growth in the battery-related industrial infrastructure to support such a tremendous expansion in demand.
That suggests innovators in the battery space represent one of the most promising and exciting investment opportunities going, which points to stocks related to the battery supply theme, including Albemarle Corporation /zigman2/quotes/200578017/composite ALB +0.46% , KULR Technology Group Inc (nyseamerican:KULR), Romeo Power Inc /zigman2/quotes/201354974/composite RMO -2.54% , Quantumscape Corp /zigman2/quotes/219305490/composite QS -2.21% , Sociedad Quimica y Minera de Chile /zigman2/quotes/204649875/composite SQM +4.39% , and Tesla Inc /zigman2/quotes/203558040/composite TSLA +1.56% .
We take a look below at some recent catalysts in this space.
Albemarle Corporation /zigman2/quotes/200578017/composite ALB +0.46% is a key player in the battery space. The company engages in developing, manufacturing, and marketing of chemicals for consumer electronics, petroleum refining, utilities, packaging, construction, transportation, pharmaceuticals, crop production, food-safety, and custom chemistry services.
It operates through the following segments: Lithium, Bromine Specialties, and Catalysts. The Lithium segment is the most important for our topic today, and engages in developing and manufacture of basic lithium compounds, including lithium carbonate, lithium hydroxide, lithium chloride, and value-added lithium specialties and reagents. That lithium can then be used in lithium-ion batteries, such as those used to power most EVs.
Albemarle Corporation /zigman2/quotes/200578017/composite ALB +0.46% just announced its results for the second quarter ended June 30, 2021, including net income of $424.6 million, or $3.62 per diluted share, adjusted diluted EPS of $0.89, an increase of 4%, and net sales of $773.9 million, an increase of 1%. Net sales increased 5% excluding FCS.
"Albemarle delivered another strong quarter, generating $195 million in adjusted EBITDA, driven by continued strength in demand for our Lithium and Bromine products," said Albemarle CEO Kent Masters. "We are focused on executing our accelerated growth strategy. We are in the final stages of two lithium projects which are expected to double our nameplate capacity to about 175,000 metric tons, including La Negra III/IV where construction is complete, and commissioning is progressing. We are firmly focused on advancing all our lithium projects to meet customer demand and accelerate profitable growth."
And the stock has been acting well over recent days, up something like 7% in that time.
Albemarle Corporation /zigman2/quotes/200578017/composite ALB +0.46% managed to rope in revenues totaling $829.3M in overall sales during the company's most recently reported quarterly financial data — a figure that represents a rate of top line growth of 12.2%, as compared to year-ago data in comparable terms. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($569.9M against $953.3M, respectively).
KULR Technology Group Inc (nyseamerican:KULR) manufactures and licenses next-generation carbon fiber thermal management technologies for batteries and electronic systems. This one is particularly interesting because it has massive credibility, a key niche, and almost no direct competition, which bodes well over the long run.
The central premise is its proprietary technology for preventing heat-induced catastrophic damage in EV batteries. This includes the company's two core products: its Passive Propagation Resistant (PPR) battery design (cooler and safer battery module or pack) and its Thermal Runaway Shield (TRS) (battery enclosure). The technology behind these products was developed in partnership with NASA.
KULR Technology Group Inc (nyseamerican:KULR) has already built custom heat management technology for two NASA JPL space missions (Mars Perseverance Rover and the mission to put a human back on the Moon's surface by 2025) and its tech is currently in use on the International Space Station. KULR has also already won over 30 NASA contracts, and has inked deals with the DoT and USAF.
Now the company is picking up additional momentum with the Department of Transportation. This latest permit authorizes commercial transportation of damaged, defective, or recalled (DDR) lithium-ion cells and batteries, or lithium metal cells contained in or packed with KULR's proprietary Thermal Runaway Shield (TRS) packaging.