Electric vehicle (EV) charging stocks are rising as federal legislation promotes the construction and standardization of U.S. EV charging infrastructure.
The Bipartisan Infrastructure Law proposes a $7.5 billion national EV charging network to promote electric cars. By 2030, the bill aims for 500,000 public chargers and a reliable network.
To promote EVs and infrastructure, the Inflation Reduction Act extended and modified tax advantages. The tax break on new and secondhand electric automobiles and charging equipment lasts until 2032.
In addition, New York and other states are leveraging federal subsidies to develop municipal EV charging networks for transportation and environmental initiatives. Brooklyn currently has a “superhub” charging station for 15 autos.
Let’s look at three “moderate buy” EV charging stocks with double-digit potential ahead of the U.S. elections.
One major participant wants a positive adjusted EBITDA run rate by December 2024. Despite supply chain issues, another industry leader is reporting record sales. And in the face of losses, a third major rival is aggressively expanding its EV charging network to meet demand.
EV Charging Stocks: ChargePoint Holdings (CHPT)
ChargePoint Holdings (NYSE:CHPT) is coming off a stellar 2023, reporting its largest-ever sequential revenue growth despite supply chain issues.
The EV charging play aims to decrease non-GAAP adjusted EBITDA loss by two-thirds by Q4 2024. ChargePoint is building up a sizable war fund, having just raised $232 million, via a mix of $175 million worth of fresh stock and changes to existing convertible notes. CHPT nets $57 million to make a push at positive non-GAAP adjusted EBITDA by Q4 FY 2024.
Overall, ChargePoint has solid liquidity, with $397 million in cash and equivalents and $150 million in unused revolving credit. With these resources, ChargePoint maintains operational and strategic flexibility.
In addition, ChargePoint reorganized and cut 12% of its worldwide staff in January 2024. This approach should simplify processes and save $33 million yearly. The new CEO, Rick Wilmer, wants to concentrate on operational excellence and efficiency. Therefore, this development is part of that strategy.
Recent capital raising and strategic restructuring expanded ChargePoint’s EV infrastructure market position; all of this is evident in analysts’ estimates, which project a 148% upside with a target price of $3.38 per share.
Blink Charging (BLNK)
In 2023, Blink Charging (NASDAQ:BLNK) announced record sales of $140 million for the whole year and $42 million for the fourth quarter. Sales increased 88% in Q4 and outpaced revenue estimates by 23%. By December 2024, BLNK wants to have positive adjusted EBITDA.
Despite higher sales, Blink lost $19.7 million in the fourth quarter and $203.7 million in 2023. Losses were incurred by non-cash goodwill, one-time payments, and intangible asset impairment. Even though adjusted EBITDA was negative by $57 million, it was still better than the $60 million loss in the prior year.
Notwithstanding the obstacle, BLNK is working on EV charging solutions in collaboration with Grupo Q in El Salvador; Frederick, Maryland; Allegiant Stadium in Las Vegas; and McArthurGlen designer stores in the Netherlands.
To compete, Blink is also enhancing its EV charging equipment. At EVS36, Blink debuted a dual-port combined charging system (CCS) and North American Charging Standard (NACS) EV DC Fast Charger to enhance user efficiency and experience worldwide. Better charging methods will make consumers happy.
Finally, in an effort to strengthen its European brand, Blink rebranded and integrated Blue Corner, a subsidiary of Blink, into Blink Charging.
As it moves toward profitability at the end of 2024, the stock has a substantial upside potential of 240%. Its current price of $2.30 per share and the average price target projected at $7.83 per share, BLNK is part of an elite group among EV charging stocks.
EV Charging Stocks: EVgo (EVGO)
At $161 million, EVgo (NASDAQ:EVGO) sales rose 195% from around $55 million in 2022. Fourth-quarter sales were $50 million, up 83% year-over-year. EVgo outperformed the market with a 72% higher earnings per share (EPS).
EVgo extended its network to include approximately 3,500 stalls by the end of 2023, with notable augmentations made possible by the EVgo eXtend initiative, which aims to provide more DC fast charging alternatives.
However, EVgo lost $135.5 million despite increased sales. At the same time, EVGO also announced $158.9 million in charging network expansion capital spending. Management knows this and President Dennis Kish was chosen to enhance efficiency and profits. Technology, marketing and corporate growth will be integrated.
Utilization rates on the EVgo network increased significantly, rising from 15% in September to over 19% in December 2023. During the year, the network throughput was around 130 gigawatt-hours (GWh).
Moreover, following statements from Tesla (NASDAQ:TSLA), GM (NYSE:GM), and Ford Motor (NYSE:F), EVgo intends to include NACS connections in select chargers and as a standard in future deployments.
Also, Autocharge+ is currently on over 50 EVgo vehicles. This makes charging quicker and simpler without an app or card at the service station.
Evgo wraps up this discussion on EV charging stocks, showing plenty of potential with its expansionary efforts and a potential upside of almost 200%.
On the date of publication, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
