Could these two growth stocks be the next big winners?

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Growth stocks are only a small part of my portfolio. After all, many growth stocks fail, so it’s not always worth taking that risk. Instead, I carefully pick my best growth stocks, looking at their performance, valuation and the trends on which their growth depends.

Today I look at two companies poised to benefit from the green revolution. Can these stocks be the next big winners?

Power Ceres

Power Ceres (LSE:CWR) is quite expensive, by a number of metrics. In fact, it has a price-to-sales (P/S) ratio of 33 and has yet to make a profit.

But this rather expensive valuation reflects the considerable potential of this stock of clean energy. The company is developing fuel cell technology, and it’s an area of ​​immense potential, as fuel cells could be used to power everything from cars to factories and even homes.

Much of Ceres’ value today lies in the technology it develops. But that could be about to change. The company expects to enter into joint venture agreements with Bosch and weichai in China in the second half. Associated licensing fees would also be coming in the second half.

Ceres, which operates on a licensing model, also expects its business with Doosan fuel cell begin to bear fruit in the near future. Doosan’s 10kW solid oxide fuel cell (SOFC), heralded as the world’s most efficient, is set for a soft launch this year. The Korean company also plans to open a 79,200 m² factory in 2024 to increase production.

Although I am optimistic about this technology, I have some concerns about its adoption. After all, there is no guarantee that this technology will take off.

That said, I would still buy Ceres stock. There is certainly a lot of interest in his technology — his collaboration with Shell — and its business model offers impressive margins, currently 66%.

NIO

NIO (NYSE: NIO) is a Chinese electric vehicle (EV) manufacturer. It has a P / S ratio of around six, which makes it considerably cheaper than its American peers – notably Lucid at 146.

It has an impressive range of electric vehicles for sale, which is good for reach and growth. And it is also launching in Europe, which will allow the company to access a richer market for its range of premium vehicles.

There are several reasons I’m bullish on NIO, including its industry-beating car performance, its use of innovative technologies including voice-activated windows, and its swappable battery technology. The latter allows drivers to show up at a NIO station and swap the battery in minutes – much faster than conventional charging.

One thing that concerns me is the penalties. Several manufacturers, including Stellantide, have closed production facilities in China over concerns about sanctions and interference over geopolitical issues between the West and Beijing. NIO is opening a battery station factory in Hungary, but I still have some concerns about the access of Chinese-made cars to Western markets if the geopolitical situation worsens.

Despite my concerns, I support NIO to succeed. There is a large Chinese market and NIO is expanding a production area in Europe. I already own NIO stock but would buy more today.

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