EV sales are set to rise to 26.8 million by 2030, but new infrastructure is needed to meet demand. Could these stocks be set to benefit?
In 2021, electric vehicle (EV)) sales represented just under 10% of all new global passenger vehicle sales, with 6.6 million units sold. By 2030, this figure is forecast to climb at a compound annual growth rate of roughly 17% to 26.8 million units. This creates plenty of opportunities for investors looking to cash in on the sector. One such opportunity is the infrastructure required to support these increasing sales figures.
With that in mind, here is a list of three EV charging stocks that can boost your portfolio in the long run.
Blink Charging Co.
Blink Charging Co. (NASDAQ: BLNK) is the only EV charging company to offer complete vertical integration. The company has deployed 48,000 charging ports across 19 countries. Recent acquisitions include companies in the Netherlands, Belgium, France, Luxembourg, and the UK.
In Q1 2022, Blink achieved record revenues of $9.8 million, representing a 339% year-over-year (YoY) increase. $8.1 million of this revenue came from product sales, which shows that its charging network is not the company’s main business. This increase in revenue came predominantly from increased sales of commercial chargers, DC fast chargers, and residential chargers. This diversified revenue offers investors better risk protection than pure-play companies.
The company’s net loss per share doubled YoY from -$0.18 to -$0.36 due to the cost of product sales increasing over fivefold as input costs have risen significantly. This may remain elevated for some time as it is unlikely the Fed can sufficiently lower inflation over the coming year.
ChargePoint Holdings, Inc.
ChargePoint Holdings, Inc. (NYSE: CHPT) operates the largest online network of independently owned EV charging stations in the world, while also making the technology used at these ports. The company has over 188,000 activated ChargePoint ports under management, with a further 320,000 accessible via roaming across Europe and North America.
In Q1 2023, the company saw revenue increase by 102% YoY to $82 million, on the back of revenue for 2022 increasing by 65% to $241 million. This is exceptional revenue growth after COVID-19 lowered gains in 2021. Compared to Blink, ChargePoint has a much larger proportion of its revenue derived from recurring sources. 49% comes from software and maintenance revenues, while 51% comes from hardware. A high percentage of recurring sales makes future forecasting more predictable and lowers future income risk.
In the most recent quarter, ChargePoint generated a net loss of $89.27 million, compared with a net profit of $82.29 in the previous year. This was due to a substantial increase in marketing, admin, and research & development expenses. The company also has a lot of non-current debt, valued at $294.07 million. This adds more risk to a company experiencing falling gross margins.
EVgo, Inc. (NASDAQ: EVGO) operates over 850 fast-charging locations in 30 states. The company is the only one that guarantees that 100% of its electricity comes from renewable sources.
In Q1 2022, EVgo saw its revenues grow 86% YoY from $4.1 million to $7.7 million, driven by higher charging demand and ancillary and regulatory credit sales growth. Capital expenditures also saw significant growth from $7.83 million last year to $28.27 million in the most recent quarter. This higher expenditure should help the company to reach its target of 3,000-3,300 stalls in operation or under construction by year’s end — up from a current figure of 2,100.
In the most recent quarter, EVgo incurred a net loss of $55.27 million, up from a loss of $16.61 million in the previous year. This resulted in the company’s cash reserves decreasing by 9% to $441.38 million. This cash pile is enough to absorb losses in the short term but, if the company’s losses continue to mount, as they have, its current cash reserves will not last too long.