Clean Energy/EV Boom – Are You Ready? (November 16, 2017)

by FI Fighter on November 17, 2017

in Clean Energy, Cobalt, Copper, Graphite, Lithium, Mining Stocks, Nickel

So, last night Tesla (TSLA) was on the stage again to make few new announcements…

First, there was the unveiling of this, the Tesla Semi:

From Electrek.

From Tesla.

From Tesla.

That is capable of doing this:

From Tesla.

Then to everyone’s surprise, there was the unveiling of this nice little surprise, the new Tesla Roadster

From Engadget.

From Tesla.

From Tesla.

That supposedly can do all this:

From Tesla.

0-60 mph in 1.9 seconds?

200 kWh battery pack supporting 620 miles range?

Fastest production car ever made

 

OMFG

 

Full highlights of the Tesla Semi and Roadster event:

I’m in the Bay Area right now… and met up with a good friend who works in high-tech this afternoon for lunch… What do you think we mostly talked about over our meal?

The new Tesla Roadster, of course…

Well, not just how freekin awesome the new Roadster looks, but also the following noteworthy price action of certain lithium companies:

That’s right…

Don’t forget, as much as I admire and appreciate new high-tech gadgets, I’m an investor/speculator first and foremost!

It’s All About the Benjamins Baby!

As you can see from above, many lithium stocks have experienced explosive gains to the upside in 2017… but quite frankly, in my own assessment, we aren’t even in the first inning yet of the Smartphone 2.0 revolution (paradigm shift towards clean energy/electric vehicles)!

Nope, as far as I can tell, this is the bottom of the first inning still pre-game warmups (I’m revising my stance and making a call that the 1st inning will truly begin for EVs when Model 3 production ramps up to ~5k/month)!

But definitely, the hype is starting to build… and it will only be a matter of time before we witness tipping point… and then inevitably, mass adoption.

To keep myself “cool, calm, and collected“, here are three graphics I like to refer to regularly (to help me keep perspective on things):

Graphic 1: Technological Disruptions are ALWAYS underestimated by “experts” and “analysts” by a country mile…

From Tony Seba.

Graphic 2: Paradigm shifts take a lot of time… yet very little time (to advance from tipping point through to mass adoption)…

Graphic 3: Certain industries will benefit (much) more than others…

 

The Internet.

Smartphones.

Clean Energy/EV.

 

These are “once in a decade” type of phenomenons…

 

I pretty much missed out on the first two, but since 2013, I’ve been very cognizant of this shift towards electric vehicles and I told myself early on:

 

I fucking don’t want to miss out on this!

 

Published on July 10, 2013.

 

And as readers know, I’ve been babbling on about clean energy mining stocks since the summer of 2016… My stance has not changed at all since then, and if anything, I’m even more bullish today than I was when I first published those original articles

There is so much going on in the clean energy/EV space to get super excited about!

Like, for instance, Shenzhen aiming to become the first city in the world to switch to 100% electric bus fleet…

From Clean Technica.

 

When it comes to EVs, China is the 800 lb gorilla in the room that investors/speculators need to be watching most closely…

From Galaxy Resources.

 

 

I must sound like a broken record by now, but i just think there’s too much momentum and traction being gained for this clean energy/EV revolution to go bust… It’s an unstoppable force at this point, as far as I’m concerned…

So, I want to be well positioned in the following clean energy/EV metals:

  • Lithium.
  • Cobalt.
  • Nickel.
  • Copper.

It’s a work in progress, but just like I believed in 2016 (and still do as I write this), I really think point blank — Over the next few years, massive gains are going to be made by investors/speculators who get well positioned into the highest quality junior companies who control the best undeveloped mineral deposits of the Big 4 clean energy/EV metals outlined above.

Graphite, rare earths, manganese, vanadium (redox battery for grid energy storage), and so on… Yup, those other clean energy/EV materials should do extremely well too, but in my own experience they are a bit trickier to figure out… Best of luck to everyone, regardless of what you decide to focus on, but for myself, I’m fixated on the Big 4 at this time…

 

2017, it’s been a pretty good year to get stretched out and warmed up…

 

But let’s be real here…

 

The 1st inning of the clean energy/EV ballgame isn’t scheduled to start until 2018…

 

Are you ready to play ball?!?

 

Photo Credit: Engadget.

{ 17 comments… read them below or add one }

1 EmpireNo Gravatar November 18, 2017 at 9:25 am

I like the “Idea” of Electric vehicles, but I think its going to take a lot longer for mass implementation than people think. However with that being said the trend is your friend until its not

So now you need to make a post talking about your favorite plays in these sectors. As I see it a lot of the highest quality names have already had huge runs, INV, ECS etc etc so maybe the easy money has been made?. If you still believe the story time to look for undervalued underfollowed gems. Or continue to buy up the largest high quality names believing they will go higher still. Lots of different ways to play it I guess

The contrarian in me also has to look at Oil here. Very under-owned and hated. The kryptonite of the Clean energy story. I think its going to make a comeback as the cycle continues to play out, inventories draw down and global demand increases.

Reply

2 FI FighterNo Gravatar November 18, 2017 at 9:45 am

Empire,

Thanks for sharing your thoughts. Nobody has a crystal ball, but I think the writing is clearly on the wall pointing towards the shift to go fully 100% electric vehicles in the future. For some countries, I think the transition will be more gradual, but when you look at the number of Gigafactories coming online soon, it doesn’t take a rocket scientist to figure out that demand for these clean energy materials will increase profoundly due to the need to secure supply chain.

Oil could very well be a contrarian play, but since I already own some uranium stock, I have no real interest to dabble in another “contrarian” industry where I do not see explosive future growth.

There are many ways to make money, so just stick to what you are most comfortable with…

In regards to “favorite plays” there’s always another train arriving at the station… When something gets bid up, look for the next crop of prospects…

Cheers!

Reply

3 Mr. 1500No Gravatar November 19, 2017 at 6:26 am

I drove a Model S (P85D) a couple years ago and was sold instantly. Quiet, simple and smooth. I have 3 internal combustion vehicles now, but will never have another. Game over. Do not pass go. Go directly to an EV for your next vehicle.

So yeah, I think you’re right; EVs will start to take over much faster than most folks think. Now, it will take a while before we see anything close to 50% of vehicles on the road being powered by electrons, but I’d bet that 25% of new vehicles sold in the US will be electric by 2025. And that number will be higher in China and some countries in Western Europe.

I’m pulling these numbers out of my a$$ and have nothing to back it up, but the EV has left the starting gate and is gaining momentum quickly. Bye-bye dino-fuel.

I also wonder if humans will be allowed to drive in 20 years (did you see that Waymo news?!).

I also wonder how many of us will be flying to work in 10 years (have you read the Uber Elevate whitepaper!?).

I’m all over the place here. But hell yeah, I WANT that Roadster.

I wish you lived closer. We could geek out for hours.

Reply

4 FI FighterNo Gravatar November 21, 2017 at 11:24 am

Carl,

I totally here you on EVs and Teslas… I still remember the first time I saw a Model S at work, my mind was blown!

Even in 2013, I thought you could see the writing on the wall and eventual shift towards mainstream adoption. It will be exciting to see how much the world changes over the next decade and EVs become the new standard.

Will let you know if I’m ever around your neck of the woods, and feel free to reach out if you ever find yourself in the SF Bay Area (hopefully I’m not overseas at the time, haha).

Cheers!

Reply

5 PassivecanadianincomeNo Gravatar November 18, 2017 at 4:35 pm

Great post. I agree with you. This and renewable energy ( there has been alot of massive financial investment firms stating they are getting out of oil stocks. As for electric cars there are a bunch of countrys and videos putting a date to ban new gas emitting cars. Like you said the table will turn very fast. Know any dividend miners producing the top 4 metals?
Cheers

Reply

6 FI FighterNo Gravatar November 21, 2017 at 11:27 am

PCI,

In terms of dividend payers, you might want to check out the larger cap companies:

-Glencore (cobalt)
-SQM (lithium)

Hmm, off the top of my head I’m not sure how much exposure the behemoths like BHP, Rio Tinto, Vale, etc… have… Might want to do some more research into those names, but they won’t be direct exposure plays since those companies are so diversified.

I’m sorry, for the most part, I only research and focus on junior companies.

All the best!

Reply

7 VinNo Gravatar November 18, 2017 at 11:16 pm

Wassup Jay?

I hadn’t checked in this week but I did see your ‘donation post’. Even though my portfolio is deep in the red, and my broker will probably give me a margin call early next week, I did manage to find some savings which I donated to a noble cause 😉 If you’re ever in Australia/Sydney then hit me up for a nice burger + beer as a follow up donation from my end.

Reply

8 FI FighterNo Gravatar November 21, 2017 at 11:29 am

Vin,

Thanks so much for the donation, I really appreciate the support!

Man, I hope you are just joking about the margin call! I would hate for that to happen to you!

Yeah, my miners are all bloody red right now, but that’s just how the game goes a lot of the time, unfortunately.

Hang in there, and we should see happy days again! Sooner rather than later, fingers crossed! 🙂

Best wishes!

Reply

9 KevinNo Gravatar November 19, 2017 at 9:38 am

Great post, Jay. I’m excited about the EV boom as well.

I’m also wondering if nuclear could also see a boon as well in this revolution. The electricity has to come from somewhere and what’s the point of having clean vehicles if the source is from a pollutant.

Reply

10 FI FighterNo Gravatar November 21, 2017 at 11:30 am

Kevin,

That’s very possible since infrastructure will become increasingly important to support all these new EVs on the road.

Nuclear is a pretty contrarian play atm… I own some for exposure but not confident enough to bet the farm on it.

Cheers!

Reply

11 AnkitNo Gravatar November 19, 2017 at 9:40 am

So far i can see
ECSIF – Ecobalt Solutions Inc,
NXE – NexGen Energy Ltd,
BALMF – Balmoral Resources Ltd,

Any other top picks for EV metals?

Reply

12 FI FighterNo Gravatar November 21, 2017 at 11:30 am

Ankit,

I’ll try and put together a list for all the metals! Those names you mentioned above are great ones, and I own each stock in my portfolio.

Take care!

Reply

13 CobaltCopperNo Gravatar November 20, 2017 at 12:12 am

@Ankit
low market cap: Fortune Minerals, Cruz Cobalt, Nzuri Copper
Biggest near term producer: Katanga Mining (Massive!!!! Ressource) but quite pricy now

Reply

14 FI FighterNo Gravatar November 21, 2017 at 11:31 am

CC,

Thanks for sharing those picks!

Cheers!

Reply

15 FineusNo Gravatar November 22, 2017 at 6:59 pm

Jay–whats your thoughts on Clean Teq CLQ.AX
Its a Robert Friedland company with a 100% owned and fully permitted Cobalt/Nickel/Scandium deposit-located in Austraila.
–they are planning to go into production in 2018/2019

Reply

16 FI FighterNo Gravatar November 26, 2017 at 1:10 pm

Fineus,

I like Clean TeQ but think it’s fairly valued now and prefer “cheaper” alternatives such as Ardea Resources.

Clean TeQ is further along and have a tremendous backing, so it’s definitely well supported.

All the best!

Reply

17 KevinNo Gravatar December 1, 2017 at 9:44 pm

Jay,

Thanks for the great info!

I came across a critique of the UBS chart of incremental commodity demand (Your Graphic #3) and wanted to get your thoughts.

Apparently, the chart grossly understates the impact of batteries on graphite demand because graphite already has a large market outside of battery storage so the percentage increase in the overall market is smaller when compared to lithium where the #1 demand usage is already from batteries.

With that in mind, have you come across any graphite companies that interest you?

Reply

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