Shares of QuantumScape (QS) are up 34% heading into the close after the battery startup announced a major breakthrough in its manufacturing process for solid-state lithium-metal batteries. As a result, the company said that it has now made its Cobra ceramic separator process the standard in its battery production. This milestone is a big step toward making next-generation batteries a reality, not just for electric vehicles but for general energy storage applications as well.
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Interestingly, the Cobra process significantly improves production efficiency by treating battery cell components 25 times faster than previous methods while using much less equipment. This allows QuantumScape to scale production more easily, even to gigafactory levels. The company states that the new process could help deliver longer battery life, faster charging times, and lower costs, all of which are crucial for commercializing solid-state batteries. CEO Siva Sivaram called Cobra “a powerful path forward” for making its advanced battery tech more widely available.
It is worth mentioning that solid-state batteries are often called the “holy grail” for EVs because they offer more energy in a smaller, lighter form and can charge faster than traditional lithium-ion batteries. QuantumScape’s long-time backer, Volkswagen (VWAGY), which holds a 24% stake in the company, is especially interested in using the new tech in its electric vehicles. In fact, Volkswagen signed a deal last year to license QuantumScape’s production technology. QuantumScape also revealed that it has signed agreements to supply battery samples to several other major and luxury car manufacturers.
Is QS Stock a Good Buy?
Turning to Wall Street, analysts have a Hold consensus rating on QS stock based on one Buy, four Holds, and two Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average QS price target of $4.90 per share implies 16.1% downside risk.
