Day Traders Pile Into EV Stocks Even as Tesla Sells Off

(Bloomberg) -- The little guy loves EV stocks -- but not Tesla. 

Retail investors bought $378 million in shares of electric-vehicle carmakers over the past week, including high-flying Rivian Automotive Inc. and Lucid Group Inc., and also Ford Motor Co., according to data compiled by Vanda Research. Demand for those three blew past purchases of Tesla Inc., whose stock has plunged around 15% since hitting an all-time high less than two weeks ago. 

Rivian in particular has been a focus since its initial public offering, as the stock has doubled its $78 IPO price and the company now sports a market value of around $150 billion, which is more than Volkswagen AG.

Demand for EV manufacturers and companies that make charging stations, like EVgo Inc., was clear on Fidelity’s platform, where many of the top buys in recent sessions have involved the industry. The four most bought stocks on Monday were Rivian, Tesla, Gores Guggenheim Inc. -- the SPAC which is set to merge with EV-maker Polestar -- and Lucid.

Some on Wall Street expect companies like EVgo, Blink Charging Co., and QuantumScape Corp. to see increased interest as green energy stocks broadly benefit from Tesla’s slowdown ahead of the expected passage of the so-called Congressional reconciliation bill. Tesla’s prominent role in retail portfolios means the stock’s latest moves have “created a need to rebalance and EV/green names are very well positioned to capture the demand,” said Vanda’s Ben Onatibia and Giacomo Pierantoni.

To be clear, it’s not as if Tesla’s struggling. It’s rallied nearly 50% this year and closed 4% higher on Tuesday. The difference is Lucid has quadrupled and Ford has doubled. The recent 15% drop in Tesla shares, spurred in part by Chief Executive Elon Musk’s stock sales, has come amid Ford’s surge to a two-decade high and as Rivian’s stellar debut made it one of the auto industry’s top five companies by value.

In the day-trading community, EV-tied companies have replaced meme stocks like AMC Entertainment Holdings Inc. as the go-to buys. Indeed, retail investors were net sellers of AMC on Monday, one of the few times this year, dumping roughly $2.2 million worth of stock.

To be sure, a basket of 37 meme stocks tracked by Bloomberg has gained 15% in the past three months, more than triple the gains of the S&P 500 Index. The group’s top performances over that stretch include Lucid’s surge, SoFi Technologies Inc.’s 55% rally and GameStop Corp.’s nearly 30% climb.

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