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Avoid These 2 Electric Vehicle Stocks Bank of America Downgraded By StockNews


© Reuters. Avoid These 2 Electric Vehicle Stocks Bank of America Downgraded

In the face of a global semiconductor chip shortage, the electric vehicle (EV) industry is struggling. The industry will experience weak momentum as many manufacturers have planned production cuts to address the shortage of chip chips. It may therefore be wise to stay away from financially weak EV stock Fisker Inc. and Lordstown Motors RIDE, whose ratings have been recently downgraded at Bank of America (NYSE). Continue reading. Electric vehicles (EVs), as many governments around the globe implement measures to decrease carbon emissions, will eventually dominate the automobile market. Some companies have seen their financial performance decline due to recent supply and production bottlenecks.

The EV industry is facing a shortage of semiconductor chips worldwide, which could limit its growth potential. Many players are planning to cut production drastically and temporarily close factories. In order to take advantage of industry tailwinds, dominant players could increase competition and limit the growth potential for smaller companies in the EV market.

Thus, we think investors should avoid Fisker Inc. (FSR) and Lordstown Motors Corp. (RIDE), which were recently downgraded by analysts at Bank of America, given these companies’ weak fundamentals and negative earnings growth potential.

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