10 Best EV Stocks In Canada (Feb 2023): Go Green

Canadians bought more electric vehicles (EVs) between 2019 and 2020 than all of 2002-2010.

However, EVs still make up a small percentage of the total vehicles currently in use, and it will take years, maybe a couple of decades, before the EV market is saturated.

So looking into and investing in the best EV stocks in Canada now might be a forward-looking choice.

Best EV Stocks In Canada

Since there are only a handful of EV manufacturers in Canada, the scope of EV stocks includes several other companies, including many that overlap heavily with the automotive industry in general (not just EVs).

I haven’t included companies like Blackberry on this list, which only has an overlap with an EV’s software tech.

1. Magna International Stock

Magna International Stock
  • Market: TSX
  • Ticker: MG.TO
  • Niche: Automotive manufacturing
  • Forward Dividend Yield: 2.92%
  • Dividend Payout Ratio: 77.19%
  • Dividend Yield (12-Month Trailing): 2.01%
  • Upcoming Dividend Date: Dec 02, 2022
  • Market Cap: $25.59 Billion
  • Forward P/E Ratio: 11.49
  • Average Analyst Rating: 2.3 - Buy

Magna is the largest vehicle company in Canada. It creates both complete vehicles and individual automotive products, and though the latter is its forte, the company has created over 3.7 million complete vehicles since its inception in 1957.

It has about 347 production and assembling facilities in 28 countries and has risen as one of the top suppliers of certain vehicle parts. Its overlap with the EV market comes with its power train product.

But a significant number of its other products are being used by EV manufacturers around the globe.

2. Ballard Power Systems Stock

Ballard Power Systems Stock
  • Market: TSX
  • Ticker: BLDP.TO
  • Niche: Fuel cell manufacturing  
  • Forward Dividend Yield: N/A
  • Market Cap: $2.64 Billion
  • Forward P/E Ratio: -13.41
  • Average Analyst Rating: 3.0 - Hold

Ballard is right at the core of EV, i.e., creating one of the power solutions that drive these vehicles.

The company creates Proton Exchange Membrane or PEM fuel cells which are used in a number of different markets, several of which are within the EV domain.

This technology makes Ballard both a hydrogen-oriented company and an EV company since it uses hydrogen as a fuel to generate electricity.

The company caters to EV markets like rails, transit buses, trucks, and individual vehicles. All of these are technically classified as hydrogen vehicles, but apart from the fact that they are fueled, not charged, there is little difference.

Ballard offers incredible cyclical growth, but you may have to wait decades to catch the next bull run.

The company experienced 1,300% growth between Dec 2018 and Feb 2021.

3. Lion Electric Stock

Lion Electric Stock
  • Market: TSX
  • Ticker: LEV.TO
  • Niche: Medium and heavy-duty electric vehicles
  • Forward Dividend Yield: N/A
  • Market Cap: $775.83 Million
  • Forward P/E Ratio: -7.63
  • Average Analyst Rating: 2.7 - Hold

Lion Electric markets itself as the early bird in Canada’s medium and heavy-duty EV market. Its product line includes trucks, schools, and public transit buses.

It also offers relevant services and solutions suites like charging infrastructure and telematic. The company has a presence in the US as well, and it’s capable of producing about 2,500 EVs a year from its Canadian facility.

The company had already sold about 550 vehicles by 2021, mostly in Canada and some in the US.

The advantage an EV company like Lion Electric has is the probability of large orders from public entities and governments, like local municipalities changing their entire school bus fleet or a city making changes in public transit.

4. NFI Group Stock

NFI Group Stock
  • Market: TSX
  • Ticker: NFI.TO
  • Niche: Sustainable buses and motor coaches (manufacturing and relevant solutions)
  • Forward Dividend Yield: 1.53%
  • Dividend Yield (12-Month Trailing): 2.54%
  • Upcoming Dividend Date: Oct 17, 2022
  • Market Cap: $908.03 Million
  • Forward P/E Ratio: -9.49
  • Average Analyst Rating: 3.0 - Hold

The Winnipeg-based NFI Group has been in the electric, or Zero Emissions Bus (ZEB) business since 2009.

It has one of the largest production capacities (in this arena) in North America and the US: about 8,000 vehicles a year. And by the end of 2021, the company had already delivered about 1,700 buses.

The company’s growth strategy is heavily centred around bidding for new business, and with its production capacity, a decent number of won bids can push the company’s revenue up in a matter of years.

5. Martinrea International Stock

Martinrea International Stock
  • Market: TSX
  • Ticker: MRE.TO
  • Niche: Auto parts manufacturing
  • Forward Dividend Yield: 1.93%
  • Dividend Payout Ratio: 71.43%
  • Dividend Yield (12-Month Trailing): 1.45%
  • Upcoming Dividend Date: Jan 15, 2023
  • Market Cap: $1.11 Billion
  • Forward P/E Ratio: 5.77
  • Average Analyst Rating: 1.9 - Buy

As an auto parts manufacturing that’s active in ten countries and has a total of 57 locations around the globe, Martinrea’s overlap with the EV industry relies upon EV penetration.

The more EVs there are in circulation, the more Martinrea will make parts for them.

However, the company’s current overlap with EVs is only two out of its three solution categories, as its “propulsion systems” solutions are mostly centred around conventional vehicles.

6. GreenPower Motor Stock

GreenPower Motor Stock
  • Market: TSXV
  • Ticker: GPV.V
  • Niche: Purpose-built EVs
  • Forward Dividend Yield: N/A
  • Market Cap: $120.90 Million
  • Forward P/E Ratio: -103
  • Average Analyst Rating: 2.0 - Buy

GreenPower Motor is quite similar to NFI and Lion Electric since it also manufactures EV buses, but its product range also includes small passenger vehicles and cargo transport (up to 6,000 pounds).

The company is targeting multiple US markets, including school transport, where it expects to make its mark with its “BEAST” vehicle. The sales numbers of the company are decent, if not in league with the other two (74 in 2021).

7. Facedrive Stock

Facedrive Stock
  • Market: TSXV
  • Ticker: FD.V
  • Niche: Transportation network/Ridesharing
  • Forward Dividend Yield: N/A

Facedrive’s overlap with the EV industry is purely promotional. The company, which started out as a transportation network and later included food delivery and e-commerce, is all about sustainable transportation practices, and EVs are a significant part of that.

However, Facedrive’s growth potential and its revenues are tied more to the general adaption of EVs in the community rather than sales, so it’s possible that the company (as an investment) might pay off later than most others on this list.

Best American EV Stocks

8. ElectraMeccanica Stock

ElectraMeccanica Stock
  • Market: NASDAQ
  • Ticker: SOLO
  • Niche: EV designer and manufacturer  
  • Forward Dividend Yield: N/A
  • Market Cap: $128.40 Million
  • Forward P/E Ratio: -2.92
  • Average Analyst Rating: 1.5 - Strong Buy

ElectraMeccanica is a Canadian EV manufacturer that trades on the NASDAQ. Its ticker: SOLO is also the name of its flagship vehicle, which is a single-seater EV of a unique design (three-wheeler).

The concept is to create an affordable vehicle for an urban environment, and the company is capable of producing 20,000 units a year. The manufacturing is done solely in China, and in the US, the company has an assembling plant.

If the unique vehicle jumps the “novelty” barrier and becomes a mainstream commonly used vehicle, the company can be huge.

9. Tesla Stock

Tesla Stock
  • Market: NASDAQ
  • Ticker: TSLA
  • Niche: EV manufacturer  
  • Forward Dividend Yield: N/A
  • Market Cap: $601.12 Billion
  • Forward P/E Ratio: 34.54
  • Average Analyst Rating: 2.3 - Buy

Any international list of EV manufacturers would be incomplete without the leader of the pack: Tesla.

The company name is synonymous with EVs, and it has taken full benefit of the early bird advantage by ramping up production to become the largest EV manufacturer in the world.

The company is already capable of producing about one million EVs a year, and it may double that capacity by the end of 2022.

10. Lucid Motors Stock  

Lucid Motors Stock
  • Market: NASDAQ
  • Ticker: LCID
  • Niche: Luxury EV manufacturer  
  • Forward Dividend Yield: N/A
  • Market Cap: $21.24 Billion
  • Forward P/E Ratio: -9.45
  • Average Analyst Rating: 2.5 - Buy

Closing the list is Lucid Motors, a luxury/high-end EV manufacturer that uses proprietary technologies in its EVs. That’s one of the company’s key selling points and strengths, i.e., that everything about Lucid vehicles is in-house.

The number of orders the company has received and the fact that it’s already working on an international manufacturing plant (in the Kingdom of Saudi Arabia) before selling a hundred vehicles, along with its strong financial position, makes it a very bold EV manufacturer to invest in.

EV Industry In Canada

Vehicle manufacturing is not Canada’s forte. A few countries dominate this industry: China, Japan, the US, and Germany.

According to the stats, these four countries make more vehicles than the rest of the world put together.

Canada is not very high up on the list, and that’s not even counting the EVs.

EV Production And Stocks

Tesla is one of the largest EV companies globally, and many conventional vehicle manufacturers like Ford and Volkswagen (which is close on Tesla’s tail) are making great strides in that area.

But no country is in the position of giving any competition to China in the EV production market.

China is currently responsible for about one out of every two EVs produced in the world, and Chinese manufacturers are among the largest ones, beating companies with decades in the automotive industry.

And since many of the top Chinese EV producers are listed in the US markets, they are accessible to Canadian investors as well.

EV Market (Sales)

EVs are penetrating different markets at different paces, and this pace and local EV adaption is governed by many factors, including the climate policies of the country.

Norway, which is ironically the largest oil producer in Europe (if we don’t include Russia), saw more EV sales in 2021 than conventional vehicles – In a ratio of about two to one. Norway is offering a much lower tax on EVs, among a few other incentives.

New Zealand is offering cash rebates for people switching to EVs. Canadians also have a range of federal and provincial incentives to buy EVs.  

But that’s just one piece of the puzzle. Logistics of EVs, electricity costs, charging hubs, and a few other factors have the opposite effect on the sales and market penetration of EVs.

Should You Invest In The Best EV Stocks In Canada?

If you believe in the future of this technology, then it’s an investment you might want to consider. Many EV stocks in Canada (and in other countries) have already gone through the cycle of initial hype, optimistic spikes, and resulting corrections.

And in the future, the stock’s performance might be a relatively more faithful representation of the company’s financial health and growth.

And since the EV market will easily take more than a decade to mature, you might benefit from the early bird advantage.

What Canadian Company is the Next Tesla?

None. While there are many Canadian companies that show great promise in the global EV market, ousting the top EV producer in the world and the most well-known name in this space is almost impossible for any Canadian company manufacturer right now.

However, NFI Group is a leader in a specific market segment, i.e., Zero-Emission-Buses (ZEBs).

How To Buy EV Stocks In Canada

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Best EV Stocks In Canada

EVs are the future, and they are one of the most substantial steps humanity will have to take to reach net zero by 2050.

The best EV stocks in Canada have already proven their mettle, and they may offer far more aggressive growth phases in the future as EVs become more mainstream and the revenues start growing organically.

So consider buying before this lucrative asset class becomes too expensive to touch. And if you are looking for a different sustainable investment, these hydrogen stocks or carbon capture stocks might be more to your liking.

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Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

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