This “EV” stock has gained 70% in one month. It’s not Tesla.

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The change in what investors think

Volkswagen

it’s nothing short of amazing.

Shares of Volkswagen (ticker: VOW. Germany), which will arrive on Thursday, gained 39% last week and more than 70% last month. These are returns similar to electric vehicles.

Tesla

(TSLA), for example, gained about 60% in the period prior to being collected for the

S&P 500

in December.

Electric vehicle investors are prepared for such actions, but huge short-term losses and gains are not as common in the traditional automotive sector.

What changed Volkswagen, to move its shares, are its electrification goals. Now, the German carmaker is targeting about 50% of total sales by 2030 to all-electric vehicles. The company’s previous target was approximately 25% penetration of existing sales by 2030.

To make those figures, Volkswagen also announced this week plans to build six battery factories. The targets are bold and could translate into 5 or 6 million fully electric vehicles annually by 2030, about half of the 10 to 11 million the company produces. Tesla, by context, delivered about 500,000 electric vehicles in 2020.

Investors are clearly excited about Volkswagen’s change. Apparently, it only takes a couple of days to go from a traditional car manufacturer to an electric vehicle player.

For EV bulls, it may be ironic that Volkswagen shares are soaring around 40% after the announcement of the battery factories. And in the days following Tesla’s battery technology day, in September, which also presented plans for internal battery production, its stocks fell by about 8%.

But the stock market has to do with expectations and valuations. Few expected Volkswagen to essentially double the electric power of the planned battery. Tesla, on the other hand, is expected to grow 50% or more each year for the foreseeable future, and that expectation has not changed in a while.

Tesla is also valued at about 6 times the estimated sales for 2025. Volkswagen is valued at an estimated sales of about 0.5 times in 2025. The potential for VW shares is great if the company can become a second violin for and Tesla.

Shares of Tesla that arrived on Thursday rose about 1% during the week, slightly better than those of S&P and

Dow Jones industrial average.

It seems investors believe that more Volkswagen electric vehicles mean bad things to Tesla. It simply means more electric vehicles for everyone and fewer gasoline-powered cars.

As for Volkswagen, some of the air came out of the stock market on Thursday. Shares fall more than 14% in foreign trade.

Write to Al Root at [email protected]