QuantumScape Corp, an electric vehicle (EV) battery start-up, has been given an Outperform rating by Evercore ISI. The research firm has set a 12-month price target of $10.00 for the company’s stock. QuantumScape, which went public through a SPAC in 2020, is based in San Jose, California.
The start-up is focused on developing an anodeless, solid-state Lithium-Metal battery. This innovative technology offers a significantly higher energy density and reduced charging times compared to traditional lithium-ion batteries. QuantumScape’s cells have the potential to exceed the energy density of conventional batteries by 50-100%. The company’s technology is also versatile, allowing them to tailor solutions for different vehicle requirements by utilizing various cathode chemistries such as NMC or LFP.
Evercore analysts believe that while QuantumScape’s batteries may initially be priced at a premium due to their higher performance, if the technology were adopted by a mass market battery player, it could lower the cost curve for the entire EV battery industry.
The increased energy density per cell not only extends the range of EVs but also offers benefits in terms of engineering flexibility and cost savings in vehicle production through weight reduction. By eliminating the graphite anode, QuantumScape can reduce manufacturing expenses by around $20 per kilowatt-hour, which equates to savings of $2,000 per vehicle (assuming a 100 kWh pack).
This manufacturing advantage can be leveraged in two ways: QuantumScape could achieve a higher gross margin, potentially three times the industry average, or it could license its solid-state technology to major battery manufacturers like LG or Panasonic, expanding its market share.
During premarket trading on Monday, shares of QuantumScape experienced a 1.30% increase.
Definitions:
– SPAC: Special Purpose Acquisition Company, a company created solely for merging with or acquiring other companies.
– Lithium-Metal battery: A type of battery that uses metallic lithium as the anode material. It is known for its high energy density compared to lithium-ion batteries.
– Energy density: The amount of energy stored in a battery per unit volume or weight.
– Cathode chemistry: The combination of materials used in the cathode of a battery.
Sources:
– Reuters, no URL