Stock Reveal: Nomi Prins “The EV Master Key” & “Forever Battery”

Nomi Prins is back with a new stock teaser..

And this time she's back to hyping up electric car batteries.

She claims one obscure midwest company has the "EV Master Key" and that this company is creating a "forever battery."

We all know the catch, though..

She wants money to reveal the name of the stock.

The good news is that she left behind enough clues to figure out the name of the stock, and I'm going to reveal it below.

Plus, I'll let you know if it's actually worth investing in.

Let's get started!

Breaking Down The Teaser

It's nice to see a stock teaser that's not about AI for once.

Nomi Prins is instead focusing on electric cars, specifically a company that lowers the price of batteries.

According to Nomi, the cost of producing EVs has put a strain on EV manufacturers, and these companies aren't able to keep up with demand.

Because of this, cost-saving plans are being put in place, and one place where Nomi believes EVs will become cheaper is the battery.

She believes lithium-ion battery packs will help lower the cost of EVs and, in particular, EV trucks.

Lithium iron phosphate (LFP) batteries are a type of lithium-ion battery that uses lithium iron phosphate as the cathode material. They are known for their long cycle life, safety, and low cost. LFP batteries are becoming increasingly popular in electric vehicles (EVs) due to these advantages.

Pros of LFP batteries for EVs:

• Longer cycle life: LFP batteries can typically last for thousands of charge cycles, which is more than other types of lithium-ion batteries. This means that EV owners can expect their batteries to last longer and require less frequent replacement.
• Safer: LFP batteries are less likely to overheat and catch fire than other types of lithium-ion batteries. This is because they do not contain any cobalt or nickel, which are two metals that can be unstable at high temperatures.
• Lower cost: LFP batteries are less expensive to produce than other types of lithium-ion batteries. This is because the materials used to make them are more abundant and less expensive.

Cons of LFP batteries for EVs:

• Lower energy density: LFP batteries have a lower energy density than other types of lithium-ion batteries. This means that they can store less energy per unit weight or volume. As a result, EVs with LFP batteries may have a shorter range than those with other types of lithium-ion batteries.
• Slower charging: LFP batteries charge more slowly than other types of lithium-ion batteries. This is because they have higher internal resistance.

Despite their drawbacks, LFP batteries are becoming increasingly popular in EVs due to their advantages of long cycle life, safety, and low cost. As the technology continues to improve, LFP batteries are expected to become even more competitive with other types of lithium-ion batteries.

In addition to EVs, LFP batteries are also used in a variety of other applications, such as energy storage systems, power tools, and medical devices.

Most of these batteries are made in China, but according to Nomi, one company is spearheading the movement to make them in America.

Cummins Role In LFP Batteries

The stock Nomi is hinting at in this pitch is Cummins.

Cummins is involved in the production of LFP batteries through its joint venture with Daimler Trucks North America and PACCAR, called Accelera. The joint venture is building a $2-3 billion battery cell manufacturing facility in the United States that will produce LFP batteries for commercial battery-electric trucks.

Cummins is also involved in the development of LFP battery technology through its own research and development efforts. The company has developed a number of new LFP battery chemistries that offer improved performance and cost advantages.

Cummins is a major player in the global commercial vehicle market, and its involvement in the production of LFP batteries is a significant development in the electric vehicle industry. The company's expertise in battery technology and its strong relationships with commercial vehicle manufacturers will help to accelerate the adoption of LFP batteries in trucks and other commercial vehicles.

In addition to LFP batteries, Cummins is also developing a range of other zero-emission technologies, including hydrogen fuel cells and electric powertrains. The company is committed to helping its customers transition to a more sustainable future.

The Pros Of Investing In Cummins

Investing in Cummins Inc. (CMI) presents several advantages according to various sources:

1. Renewable Energy Trend: Cummins is positioned to benefit from the renewable energy megatrend, with a particular emphasis on the $130 trillion market. The company's stock has been referred to as one of the safest and smartest ways to profit from this trend.

2. Long-term Growth and Profitability: Cummins has disclosed plans aimed at long-term growth and increased profitability. These plans are anchored on the company's capabilities in providing integrated solutions across a range of combustion and electric powertrains. Additionally, Cummins has a robust financial structure to support these plans.

3. Undervaluation: According to an analysis on The Motley Fool, Cummins stock trades at a valuation that is considered to be at a discount to Wall Street's long-term earnings growth rate estimates. This suggests a potential upside for investors who enter at the current price levels.

4. Innovation in Powertrain Technology: Cummins aims to generate profitable growth through leadership in the design, manufacture, and support of powertrain technology across different fuel types. This diversified approach in powertrain technology could provide a solid foundation for sustained growth.

5. Investments in Clean Energy Technologies: Cummins has announced an investment of more than $1 billion across its U.S. engine manufacturing network to upgrade facilities in support of new clean energy technologies. This is a strong indication of the company's commitment to evolving with the industry's transition towards cleaner energy solutions.

These factors collectively suggest that Cummins is making strategic moves to position itself for growth in the evolving automotive and energy sectors, which could potentially result in a favorable investment outlook.

The Cons Of Investing In Cummins

Investing in Cummins Inc., like in any other company, carries both potential rewards and risks. Below are some of the cons associated with investing in Cummins, as gathered from multiple sources:

1. Stock Performance Risks:

   • A report on Seeking Alpha notes that despite Cummins outperforming the broader market over the last three years, this trend is predicted to end. The stock is deemed as not priced appropriately by the market to reflect certain risks. The stock traded at 12.4x forward earnings at the time of the report, which was above the pre-COVID average of between 8.5x to 10x forward earnings.

2. Industry Trends:

   • The same report mentions a multi-month slowdown in the domestic trucking industry due to decreased total tonnage shipped over American roads and a decline in spot market load volume. This slowdown is projected to impact Cummins's near-term earnings and potentially pose significant challenges for its 2023 growth projections.

3. Financial Valuation:

   • As of October 23, 2023, Cummins had a market capitalization of $31.0 billion, with a price-earnings ratio of 12.1. These metrics place it in the 95th percentile of companies in its industry, which might indicate a relatively high valuation.

4. Dividend Yield:

   • The dividend yield of Cummins, at the time of a particular report, was 2.1%, which although higher than what the broad market offered, wasn't high when compared to the yield from other sources.

5. Capital Expenditures:

   • In Q3 2023, Cummins reported capital expenditures of $280 million, which might be considered a substantial amount of reinvestment, potentially affecting the short-term returns to investors.

6. Market Expectations:

   • Cummins reported sales that beat analysts' estimates in Q3 2023, driven by robust demand for heavy-duty trucks in the US, reflecting positively on its performance. However, high expectations from the market might pose a risk if future performance doesn't align with these expectations.

Conclusion

So that's the end of my post covering Nomi Prins' newest stock teaser.

The company she claims holds the "Ev Master Key" is Cummins.

There's a lot to like about this company, but like all stocks, it has some downsides.

Are you thinking about investing in this company?

Let me know below in the comments!