ChargePoint Holdings, Inc. (NYSE: CHPT) is a goliath in the EV charging space with it operating the largest online network of independently owned charging stations in the US. Despite the company’s status as a leader in the EV charging space, CHPT stock has fallen 70% since its IPO. However, the CHPT stock forecast could improve as the company expands throughout Europe and develops its partnership with the automotive juggernaut, Mercedes, to expand across the US as well.
CHPT Fundamentals
Chargepoint already operates the largest network of independent EV charging stations in the US, putting it at the forefront of the EV revolution. Since 2017, the company has steadily expanded its charging station network from 42.9 thousand, reaching 225 thousand this year. Specializing in key verticals such as commercial, fleet, and residential, CHPT positions its charging stations in frequently visited areas or locations with high traffic such as apartment complexes, public libraries, parks, hotels, stores, and other businesses. Thanks to this, 80% of CHPT’s customer base included 2021’s Fortune 50 companies.
Meanwhile, demand for EVs is rising around the world, causing the number of EVs on the road to jump from 22 thousand to more than 2 million over the last decade. The International Energy Agency expects that the sale of EVs will reach 60% of total automotive sales by 2030 which is a tailwind for EV stocks like Lucid Group, Inc. (NASDAQ: LCID), Polestar (NASDAQ: PSNY), and Mullen Automotive Inc. (NASDAQ: MULN),.
But as new policies promoting the use of EVs are rolled out across Europe and the USA, investors should also keep in mind the EV charging stocks which will also see swelling demand in the coming years. CHPT stands to directly benefit from the $7.5 billion allocated to building a nationwide charging network and the transition of government and corporate vehicles to EVs.
Rather than trying to select the EV company with the greatest potential to dominate the market, investing in companies developing charging technology like CHPT may offer more upside because its products can be utilized by any EV. As the EV market continues to expand, demand for EV charging spaces will too which is why CHPT stock could have the most to gain from the EV revolution.
As is, EV adoption is expected to rapidly increase as the EPA proposes limits to tailpipe emissions, potentially causing 67% of new vehicles sold in the US to be electric by 2032. At the same time, the European Parliament voted to support a ban on the sale of diesel and petrol vehicles starting in 2035 which would substantially increase demand for EVs across Europe. Considering that CHPT operates in the US and Europe, policymakers’ rising interest in protecting the environment could signal a shift in the CHPT stock forecast over the coming years.
Competition
However, the EV charging space is highly competitive with many companies offering the same services as CHPT. While CHPT faces competition from Tesla, Electrify America, and Blink, CHPT has an edge thanks to its network of 27,000 stations offering nearly 50,000 individual charging ports across the US. This gives it approximately 70% of North America’s publicly available AC charging market. For comparison, Blink has 1,606 EV stations for a total of 5 thousand public chargers in the USA and Electrify America offers 800 charging stations with 3,500 individual chargers.
On the other hand, Tesla boasts a network of around 16,822 Superchargers and Tesla destination chargers. Some of these can be used by other types of vehicles with an adapter but considering that not all drivers own this adapter its not exactly comparable. Based on this, CHPT does have significant market share based on how widespread its network is alone.
Despite this, CHPT does face a disadvantage. Most of CHPT’s chargers are level 2 AC chargers which take around 8 hours to fully charge a vehicle. According to its 2022 annual report, CHPT offers 18,900 direct current fast charging ports of which only 1,867 appear to be in the USA.
Blink offers DC fast charging stations which take only 30 minutes to charge a vehicle and Electrify America’s network mainly utilizes these fast chargers. However, Tesla clearly has the edge when it comes to fast charging since it can charge up to 200 miles in only 15 minutes using its Superchargers.
For this reason, CHPT is working with Mercedes-Benz and MN8 Energy – one of the US’ biggest renewable energy producers – to offer more DC chargers in the US and Canada. At the beginning of the year the three companies began working on more than 400 charging hubs which would offer over 2500 CHPT DC fast charging ports. While CHPT must close the gap between itself and its competitor’s fast charging capabilities, its latest decision could help position in it to compete in the EV charging space long-term – ultimately improving the outlook for CHPT stock.
European Expansion
CHPT is focused on expansion in both markets since the company has also entered a joint venture with the French fleet managing and car leasing company, ALD automotive, for expansion in Europe. Through this partnership, the companies will create an electric Mobility Service Provider focused on services for corporate fleets.
This new EV charging business is expected to start operating in Q4 2023 and will provide corporate fleets not only with charging solutions but payment and reimbursement reports as well. The JV could encourage wider adoption of CHPT’s network and app since fleet drivers will gain access to CHPT’s network of more than 485 thousand charging ports across Europe. As CHPT continues to gain market share in Europe, CHPT stock could benefit from the additional users brought on by this expansion.
CHPT Financials
According to CHPT’s annual report, as of January 2023 the company had
1
billion in assets, including
264
million in cash and cash equivalents,
105
million in short term investments and
30
million in restricted cash. CHPT has
725
million in liabilities,
284
million of which are current liabilities. Looking into CHPT’s revenues, the company reported $448 million in revenues. Finally the company’s operating expenses totaled $427 million and it reported
345
in net losses.
Technical Analysis
CHPT stock is trading in a sideways channel between $9.05 and $11.40. Looking at the indicators, CHPT stock is currently trading beneath the 21, 50, and 200 MAs on the hourly timeframe – a bearish sign. The stock also broke through its $9.02 support. There was recently a death cross of the 50 and 200 MAs which is another sign that CHPT stock may continue to decline.
CHPT stock reached an all time low of $8.10 in December 2022 and may retest this low as bearish market sentiments affect growth stocks in the EV ecosystem. However, the RSI is currently oversold at 30 and the MACD is bearish. Therefore CHPT stock may bounce slightly as the indicator recalibrates.
Fundamentally, CHPT stock has had no other catalysts besides its announced JV with ALD automotive. However. if the EPA’s proposed restriction on tailpipe emissions is approved that could be a catalyst for not only EV stocks but charging companies like CHPT as well.
Looking at the options flow for premiums over 50 ,000 expiring in April, there has been some bullish activity with a whale buying calls with a strike of
10
on April 5th. However, bearish premiums make up 54% of the activity.
CHPT Forecast
With the US and Europe continuously pushing towards EV adoption, CHPT stands to benefit from greater demand for its services. However, CHPT stock has been impacted by the company’s unprofitability with expectations that profitability is still years away.
Despite this, the CHPT stock forecast could be set to improve as the company blamed the affects of supply-chain limitations for some of its turmoil in Q4. As supply chain conditions improve for certain hardware products, things could normalize for the company going forward. Additionally, CHPT has achieved impressive growth in key areas such as increasing its sales by 93% YoY and bringing in 70% of its billings from existing customers. This means that CHPT’s current customers are satisfied with its services, creating a strong customer base for the company’s continued growth.
For these reasons, analysts are optimistic about CHPT stock giving it a median price target of
16
and an overall buy rating. Based on future cash flow estimates, CHPT stock is currently trading below its fair value which also indicates the stock’s upside potential. If CHPT is able to accelerate its sales growth, the CHPT stock forecast could continue to improve.
Considering that demand for EVs is likely to surge by the start of the next decade, CHPT’s decision to partner with Mercedes Benz and MN8 to increase its number of DC chargers will help strengthen its position against competitors. CHPT’s partnership with ALD automotive will also increase the company’s grip on the European market – potentially putting it on track for better sales growth in the future.
CHPT Fundamentals
Chargepoint already operates the largest network of independent EV charging stations in the US, putting it at the forefront of the EV revolution. Since 2017, the company has steadily expanded its charging station network from 42.9 thousand, reaching 225 thousand this year. Specializing in key verticals such as commercial, fleet, and residential, CHPT positions its charging stations in frequently visited areas or locations with high traffic such as apartment complexes, public libraries, parks, hotels, stores, and other businesses. Thanks to this, 80% of CHPT’s customer base included 2021’s Fortune 50 companies.
Meanwhile, demand for EVs is rising around the world, causing the number of EVs on the road to jump from 22 thousand to more than 2 million over the last decade. The International Energy Agency expects that the sale of EVs will reach 60% of total automotive sales by 2030 which is a tailwind for EV stocks like Lucid Group, Inc. (NASDAQ: LCID), Polestar (NASDAQ: PSNY), and Mullen Automotive Inc. (NASDAQ: MULN),.
But as new policies promoting the use of EVs are rolled out across Europe and the USA, investors should also keep in mind the EV charging stocks which will also see swelling demand in the coming years. CHPT stands to directly benefit from the $7.5 billion allocated to building a nationwide charging network and the transition of government and corporate vehicles to EVs.
Rather than trying to select the EV company with the greatest potential to dominate the market, investing in companies developing charging technology like CHPT may offer more upside because its products can be utilized by any EV. As the EV market continues to expand, demand for EV charging spaces will too which is why CHPT stock could have the most to gain from the EV revolution.
As is, EV adoption is expected to rapidly increase as the EPA proposes limits to tailpipe emissions, potentially causing 67% of new vehicles sold in the US to be electric by 2032. At the same time, the European Parliament voted to support a ban on the sale of diesel and petrol vehicles starting in 2035 which would substantially increase demand for EVs across Europe. Considering that CHPT operates in the US and Europe, policymakers’ rising interest in protecting the environment could signal a shift in the CHPT stock forecast over the coming years.
Competition
However, the EV charging space is highly competitive with many companies offering the same services as CHPT. While CHPT faces competition from Tesla, Electrify America, and Blink, CHPT has an edge thanks to its network of 27,000 stations offering nearly 50,000 individual charging ports across the US. This gives it approximately 70% of North America’s publicly available AC charging market. For comparison, Blink has 1,606 EV stations for a total of 5 thousand public chargers in the USA and Electrify America offers 800 charging stations with 3,500 individual chargers.
On the other hand, Tesla boasts a network of around 16,822 Superchargers and Tesla destination chargers. Some of these can be used by other types of vehicles with an adapter but considering that not all drivers own this adapter its not exactly comparable. Based on this, CHPT does have significant market share based on how widespread its network is alone.
Despite this, CHPT does face a disadvantage. Most of CHPT’s chargers are level 2 AC chargers which take around 8 hours to fully charge a vehicle. According to its 2022 annual report, CHPT offers 18,900 direct current fast charging ports of which only 1,867 appear to be in the USA.
Blink offers DC fast charging stations which take only 30 minutes to charge a vehicle and Electrify America’s network mainly utilizes these fast chargers. However, Tesla clearly has the edge when it comes to fast charging since it can charge up to 200 miles in only 15 minutes using its Superchargers.
For this reason, CHPT is working with Mercedes-Benz and MN8 Energy – one of the US’ biggest renewable energy producers – to offer more DC chargers in the US and Canada. At the beginning of the year the three companies began working on more than 400 charging hubs which would offer over 2500 CHPT DC fast charging ports. While CHPT must close the gap between itself and its competitor’s fast charging capabilities, its latest decision could help position in it to compete in the EV charging space long-term – ultimately improving the outlook for CHPT stock.
European Expansion
CHPT is focused on expansion in both markets since the company has also entered a joint venture with the French fleet managing and car leasing company, ALD automotive, for expansion in Europe. Through this partnership, the companies will create an electric Mobility Service Provider focused on services for corporate fleets.
This new EV charging business is expected to start operating in Q4 2023 and will provide corporate fleets not only with charging solutions but payment and reimbursement reports as well. The JV could encourage wider adoption of CHPT’s network and app since fleet drivers will gain access to CHPT’s network of more than 485 thousand charging ports across Europe. As CHPT continues to gain market share in Europe, CHPT stock could benefit from the additional users brought on by this expansion.
CHPT Financials
According to CHPT’s annual report, as of January 2023 the company had
1
billion in assets, including
264
million in cash and cash equivalents,
105
million in short term investments and
30
million in restricted cash. CHPT has
725
million in liabilities,
284
million of which are current liabilities. Looking into CHPT’s revenues, the company reported $448 million in revenues. Finally the company’s operating expenses totaled $427 million and it reported
345
in net losses. Technical Analysis
CHPT stock is trading in a sideways channel between $9.05 and $11.40. Looking at the indicators, CHPT stock is currently trading beneath the 21, 50, and 200 MAs on the hourly timeframe – a bearish sign. The stock also broke through its $9.02 support. There was recently a death cross of the 50 and 200 MAs which is another sign that CHPT stock may continue to decline.
CHPT stock reached an all time low of $8.10 in December 2022 and may retest this low as bearish market sentiments affect growth stocks in the EV ecosystem. However, the RSI is currently oversold at 30 and the MACD is bearish. Therefore CHPT stock may bounce slightly as the indicator recalibrates.
Fundamentally, CHPT stock has had no other catalysts besides its announced JV with ALD automotive. However. if the EPA’s proposed restriction on tailpipe emissions is approved that could be a catalyst for not only EV stocks but charging companies like CHPT as well.
Looking at the options flow for premiums over 50 ,000 expiring in April, there has been some bullish activity with a whale buying calls with a strike of
10
on April 5th. However, bearish premiums make up 54% of the activity. CHPT Forecast
With the US and Europe continuously pushing towards EV adoption, CHPT stands to benefit from greater demand for its services. However, CHPT stock has been impacted by the company’s unprofitability with expectations that profitability is still years away.
Despite this, the CHPT stock forecast could be set to improve as the company blamed the affects of supply-chain limitations for some of its turmoil in Q4. As supply chain conditions improve for certain hardware products, things could normalize for the company going forward. Additionally, CHPT has achieved impressive growth in key areas such as increasing its sales by 93% YoY and bringing in 70% of its billings from existing customers. This means that CHPT’s current customers are satisfied with its services, creating a strong customer base for the company’s continued growth.
For these reasons, analysts are optimistic about CHPT stock giving it a median price target of
16
and an overall buy rating. Based on future cash flow estimates, CHPT stock is currently trading below its fair value which also indicates the stock’s upside potential. If CHPT is able to accelerate its sales growth, the CHPT stock forecast could continue to improve. Considering that demand for EVs is likely to surge by the start of the next decade, CHPT’s decision to partner with Mercedes Benz and MN8 to increase its number of DC chargers will help strengthen its position against competitors. CHPT’s partnership with ALD automotive will also increase the company’s grip on the European market – potentially putting it on track for better sales growth in the future.