Is he a modern-day Leonardo da Vinci?
Or just a master grifter?
Everyone has an opinion about Elon Musk.
But whether you love him or hate him, you have to admit that opportunity always seems to follow wherever he goes.
Musk has been at the helm of Tesla (NASDAQ: TSLA) for nearly 20 years. And in that time, amid unkept promises and years-late deliveries, he’s still managed to grow Tesla into the most valuable car manufacturer in the world — in most cases by a factor of 10!
And not simply because of the cars it makes. But because of the technological opportunities that the company (and Musk) creates.
Tesla makes cars. But it’s also a software company. It’s a robotics company. It’s a battery company.
And no matter how fast traditional car makers try to play catch up, they’re still a long way off from what Musk is serving up. (None have generated any significant profit from the EV segments.)
And now, his sudden “bromance” with President-elect Trump has once again put Musk and Tesla in the spotlight.
Trump has gone on record saying he’s not a fan of the Biden administration’s “EV mandate.” But, notably, his tone has softened since the “First Buddy” helped deliver a decisive electoral victory in November.
The market seems to understand this because since Musk endorsed Trump, Tesla’s share price has rallied substantially.
There looks to be a great deal of opportunity coming on the heels of this “merger.”
But there are other strategic ways to capitalize on the Trump/Musk trend besides Tesla…
Playing the Tesla Wave Strategy #1: Large Cap
While Tesla is the 800-pound gorilla of the EV manufacturing world, one US player is starting to play some serious catch-up.
Rivian Automotive (NASDAQ: RIVN) is an exclusive EV manufacturer with a market cap of just over $11 billion.
The company struggled out of the gate like any other EV company has, but today they’re making great strides in growing their business overcoming production delays and delivering vehicles on a regular schedule.
Currently they only produce two models of vehicles: the R1T and R1S.
And in doing that, they’ve actually done one strategically smart thing… They opted to specialize in producing the most popular vehicle type in the US, trucks and SUVs.
Trucks and SUVs continue to be the most popular type of vehicle in the United States. Sales of trucks and SUVs were up 17.2% in August 2023 from August 2022.
This carves out a niche for them to become top competitors to Tesla’s Cybertruck.
To make their vehicles even more attractive, they’ve made their chargers compatible with Tesla’s Superchargers giving their users more options for charging when on the road.
Additionally, they’ve partnered with Amazon to deliver 100,000 electric vans by 2030 giving them a solid demand base for the coming years.
Most recently, In November 2024, the Biden administration announced a conditional commitment for a $6.6 billion loan to Rivian Automotive to support the construction of a new electric vehicle (EV) manufacturing facility in Georgia.
The planned facility, known as Project Horizon, is expected to produce up to 400,000 vehicles annually and create approximately 7,500 jobs by 2030. Rivian intends to manufacture its more affordable R2 and R3 models at this plant, targeting a broader consumer market.
Their price action has tracked Tesla’s over the past year but has lagged since “Trump/Musk” rally. Now may be their opportunity to catch up.
Rivian v. Tesla
Playing the Tesla Wave Strategy #2: Mid Cap
While Tesla typically makes people think of car manufacturers, battery technology remains the heart and soul of the EV revolution.
Enter EnerSys (NYSE: ENS), a mid-cap company specializing in energy storage solutions. Known for its innovative battery systems, it’s a critical supplier for both the EV and renewable energy sectors.
As of December 2024, EnerSys boasts a market capitalization of $3.83 billion, with its stock trading at $96.66 per share. Its steady growth and diverse product portfolio make it an ideal choice for investors seeking stability with upside potential in the rapidly expanding EV battery market.
What’s more, according to a Yahoo Finance Fair Value analysis, the company is currently significantly undervalued, with a potential 32% upside according to the web site’s analysts.
Playing the Tesla Wave Strategy #3: Small Cap
Rivian and EnerSys are both solid, well-capitalized players in the traditional EV world.
But for investors with a bit more risk appetite, you’ll want to look at smaller-cap companies looking to add a disruptive aspect to the rapidly growing sector — a company looking to bring something entirely “new” to the game.
These are the companies that offer the potentially biggest bang for your investment buck.
And if that’s what you’re looking for, Nuvve Holding Corp. (NASDAQ: NVVE) is well worth considering.
Nuvve’s breakthrough technology is called Vehicle-to-Grid (V2G) technology.
V2G is a smart charging technology that effectively allows EV batteries to resell stored unused power back to the grid — effectively making any EV owner a power provider. This innovative “personal grid” technology could well revolutionize how power is managed and monetized.
And this kind of forward thinking couldn’t come at a better time. Given the exponential demands for electricity that the AI megatrend is placing on grid and grid infrastructure, this kind of technology could be rapidly viewed as a major solution to the problem, and one that could be implemented right now without significantly overhauling the existing grid infrastructure.
Currently, Nuvve has a market capitalization of just $3.19 million. But despite its small size, the company has been making strategic moves to position itself as a major player in the nascent but rapifly growing V2G market.
While small-cap stocks carry inherent risks, Nuvve’s potential to tap into the multibillion-dollar V2G market gives it a growth trajectory that few other companies can match.
The Trump/Musk relationship has made a huge splash in the business and political industries …
… But it’s these three companies that could well be riding the wave higher.
