Why ZEEKR Intelligent Technology (ZK) is a Top Automotive Stock Investment: Insights from Industry Analysts

We have put together a list of the 12 Best Automotive Stocks to Invest in According to Analysts. Today, we will see how ZEEKR Intelligent Technology Holding Limited (NYSE:ZK) compares with other automotive stocks.

The automotive industry faces a challenging environment. Economic ups and downs, new regulations, and changing consumer needs are all at play. One major issue is the proposed 25% tariffs on goods from Mexico and Canada. The Vehicle Suppliers Trade Association, MEMA, has raised alarms about this, saying it could threaten jobs and raise costs for shoppers. Although a temporary deal to delay these tariffs brings some comfort, many uncertainties remain. For instance, the funding pause for the U.S. National Electric Vehicle Infrastructure (NEVI) program could slow down the move to electric vehicles (EVs), affecting the growth of charging stations and purchase incentives.

In December, Fitch Ratings gave the automotive industry a ‘neutral’ outlook, predicting modest growth of 2% in global light vehicle sales. With rising competition in the EV market, prices are expected to be under pressure. At the same time, inflation may prompt consumers to lean towards more affordable cars. However, projected interest rate cuts could boost vehicle demand. Automakers are diversifying their offerings into EVs, self-driving tech, and digital mobility, which might drive future growth.

Despite these challenges, the automotive sector is set to grow steadily. According to MarketsandMarkets, global light vehicle sales could rise by 1.3% by 2025, totaling 85.1 million units. This boost will likely come from increased adoption of EVs and hybrids, better battery technology, and the rise of autonomous vehicles. China is leading the charge, projected to sell over 26 million light vehicles in 2024—almost half of the global total. Furthermore, China produces over half of the world’s EV batteries and holds a significant share of essential battery components. The growing number of affluent individuals in the Asia-Pacific region is expected to further drive the demand for premium and electric vehicles.

An article by Sarwant Singh in Forbes in January 2025 also shared insights into future trends in the automotive world. They predict that sales of electric vehicles might slow due to policy changes that could make them less affordable. However, hybrid vehicle sales are expected to rise as consumers will like the combination of electric and traditional engines. Additionally, software-defined vehicles (SDVs), which are controlled by software for functions like braking and steering, are likely to see significant growth in coming years.

From an investment viewpoint, the sector is full of risks and opportunities. Even with macroeconomic and political uncertainties, the long-term outlook for the automotive industry remains promising. Now, let’s check out the top 12 automotive stocks analysts are excited about.

To pinpoint these 12 stocks, we focused on U.S.-listed companies in the auto manufacturing and parts sectors with market capitalizations over $2 billion. We looked for promising candidates, particularly pure-play auto manufacturers, and ranked them based on their potential for growth. We also noted how many hedge funds back these companies as of Q3 2024.

Note: All pricing data is as of market close on February 14.

At Insider Monkey, we pay close attention to stocks favored by hedge funds because our research shows that following their choices can lead to better market results. Our quarterly strategy selects 14 stocks, both small-cap and large-cap, and has achieved a return of 275% since May 2014, significantly outperforming its benchmark.

A lineup of electric vehicles showcases the convenience of modern transportation solutions.

Upside Potential: 39%

Number of Hedge Fund Holders: 9

ZEEKR Intelligent Technology Holding Limited (NYSE:ZK), part of China’s Geely Holding Group, specializes in premium electric vehicles. Their models, like the ZEEKR 001 and 7X, offer advanced tech, impressive battery range, and a luxury smart interior. ZEEKR aims for connectivity, autonomy, and rapid charging solutions to expand its electric vehicle offerings worldwide.

In January 2025, ZEEKR delivered 11,942 vehicles, bringing their total to 430,698. In 2024, they sold 222,123 cars, marking an impressive 87% growth from the previous year. They aim to hit 320,000 deliveries in 2025, bolstered by recent launches like the Zeekr 7X, an all-electric midsize SUV, in Europe. They are planning an extensive global rollout in the next five years to meet the rising demand for EVs, which should help increase their market share.

Analysts are optimistic about ZEEKR, giving it a unanimous Buy rating. In October, China International Capital Corporation (CICC) set an Outperform rating with a target price of $31.74. Earlier, Bank of America reaffirmed a Buy rating with a $26 target.

Overall, ZK ranks 3rd among the best automotive stocks to consider. While ZK shows promise as an investment, many believe that AI stocks might offer higher returns in a shorter period. If you’re interested in exploring a more promising AI investment that trades below 5 times its earnings, check out our report on the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.

Disclosure: None. This article was originally published on Insider Monkey.