Electric vehicle charging company
ChargePoint
just picked up a new Buy rating. The analyst’s price target implies the stock could double. Shares, however, are down on Wednesday, showing just how bad electric vehicle sentiment is these days.
Benchmark analyst Mickey Legg launched coverage of ChargePoint stock on Wednesday with a Buy rating and a $4.25 price target. That implies gains of about 106% based on Tuesday’s closing price.
Shares of ChargePoint are down 5% to $1.96 in Wednesday trading despite the bullish call. The
S&P 500
and
Nasdaq Composite,
for comparison, are off 0.4% and 1%, respectively.
ChargePoint has an “industry-leading charging network positioned to capitalize on market growth as the industry matures,” wrote Legg, pointing out that ChargePoint has about 70% market share of so-called level 2 chargers. Level 2 charges can deliver about 30 miles of charge an hour and are more common at office buildings, hotels, and commuter train stations where vehicles stay parked for longer periods.
He also called the company “well-capitalized” with more than $360 million in cash on its balance sheet and a plan to generate positive earnings before interest, taxes, depreciation, and amortization, or Ebitda, by the end of 2024.
He sees ChargePoint’s charging network growing to 447,000 plugs by 2026, up from about 225,000 at the end of 2023.
Today’s stock drop brings ChargePoint shares’ year-to-date loss to about 15%. EV-related stocks aren’t doing well this year. Investors fear a slowdown in the growth of demand after a strong 2023 when Americans bought 1.2 million battery electric vehicles, up 46% from 2022.
Through midday trading,
Tesla
stock was down about 22% year to date.
NIO,
XPeng,
and
Li Auto
shares were off about 34%, 38%, and 12%, respectively.
Rivian Automotive
and
Lucid
stocks were down about 34% and 14%, respectively. Shares of charging peer
EVgo
were down about 31%. The average decline in U.S.-listed EV-related stocks is about 23% this year, according to Barron’s calculations.
Year-to-date declines in U.S.-listed EV-related stocks have wiped out some $210 billion in market capitalization, according to Barron’s calculations. Excluding Tesla, which accounts for roughly 85% of the total EV-related market capitalization, some $35 billion has been wiped out.
With the new Buy rating, about 36% of analysts covering ChargePoint stock rate shares Buy. The average Buy-rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target for ChargePoint stock is about $3.50 a share.
Write to Al Root at [email protected]
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