Key Points

• Tesla has shown how big EV stocks can become.

• This small EV stock has huge growth potential in 2026 and beyond.

• 10 stocks we like better than Rivian Automotive ›

Most investors focus on either growth stocks or value stocks. But the best investments offer both growth and value. Right now, there’s one exciting growth stock trading at a rock-bottom valuation. If you’ve been looking for chance to buy into the next Tesla (NASDAQ: TSLA), this could be your best opportunity yet.

This electric car company will catch up to Tesla in 2026

What propelled Tesla from a scrappy upstart to a $1.2 trillion behemoth? There were many catalysts to Tesla’s historic rise. But I’d argue that the company’s best move over the past two decades was the release of its Model 3 and Model Y vehicles. Today, most of Tesla’s revenue still comes from vehicle sales. And most of its vehicle sales come from just two models: the Model 3 and the Model Y. Without those two models, Tesla simply wouldn’t be the behemoth it is today.

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Why were those two models so pivotal to Tesla’s growth? Most car buyers aim to spend less than $50,000 on their next vehicle purchase. Before the launch of the Model Y and Model 3, Tesla only had models priced at $70,000 or above. When equipped with certain options, the price of those models could easily surpass $100,000. By offering vehicles that cost under $50,000, Tesla was able to tap into tens of millions of new potential buyers.

Image source: Rivian.

Why, then, doesn’t every EV manufacturer offer vehicles below this price point? The challenge mostly has to do with capital and reputation. To get the economies of scale necessary to produce a car at that price point, a huge amount of infrastructure is needed. It’s far easier to start with a smaller volume model with a higher price point.

And mass-market buyers typically want to purchase a vehicle that has known reliability and performance. If there are previous luxury models to draw conclusions from, buyers are more willing to trust a new EV model from a brand they’re less familiar with. That’s why Tesla started with the Roadster, later expanding to the Model X and Model S, and finally the Model 3 and Model Y.

While far fewer consumers have heard of Rivian (NASDAQ: RIVN), this EV stock is prepared to replicate Tesla’s strategy for success. Right now, the company has just two high-priced luxury models: the R1S and R1T. But thanks to years of infrastructure investment, Rivian is prepping to launch three new affordable models next year: the R2, R3, and R3X. All are expected to be priced under $50,000.

Rivian stock is priced too low compared to its potential

By the end of 2026, there’s a good chance that Rivian will have as many affordable models on the market as Tesla. And yet shares trade at a price-to-sales ratio of 3, while Tesla stock trades at more than 15 times sales. Tesla does have some growth opportunities that Rivian doesn’t have currently, like robotaxis. But Rivian has also invested heavily in autonomous driving and AI. Ultimately, Rivian shares simply look far undervalued when compared to Tesla’s premium valuation.

Next year, analysts expect Rivian to grow sales by around 29%. Tesla is expected to achieve only half that growth. This all makes Rivian a strong contrarian investment for 2026, especially since a recent update from management confirmed that the production schedule for its upcoming models remains on track for early next year.

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Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.