ChargePoint Holdings (CHPT), which manages a network of electric vehicle (EV) charging stations, will release its fiscal third-quarter 2022 earnings on December 7.
On March 1, 2021, the firm began trading on the NYSE under the symbol CHPT. The company’s stock has dropped about 27% in the last six months and is presently selling at around $21. Solid Q3 results might boost the stock price, so let’s take a closer look at what Wall Street experts are forecasting.
Analysts, on average, expect ChargePoint to post an adjusted loss of $0.14 per share and revenues of $63.02 million for Q3. Meanwhile, the Earnings Whisper number, or the Street’s unofficial view on earnings, stands at a loss of $0.11 per share.
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Prior Quarter Snapshot
ChargePoint’s second-quarter financial results were strong, thanks to strength in the EV market.
Revenues surged 61% year-over-year to $56.1 million, above analyst expectations of $48.9 million.
Furthermore, the net loss of $0.29 per share was a significant improvement over the prior-year period’s loss of $6.97 per share.
Factors to Note about ChargePoint
ChargePoint’s business is anticipated to have grown significantly in the third quarter as EV penetration rises and the economy continues to improve.
During the quarter, ChargePoint completed the acquisition of has•to•be, an Austrian EV charging startup. ViriCiti, an eBus and commercial fleet charging firm, was also purchased by ChargePoint in August.
Further, the firm offers a full worldwide EV charging solution portfolio to fleets of all sizes.
ChargePoint’s recent acquisitions, together with its fast-charging offerings, should help the firm generate strong earnings in the upcoming quarter.
On the other hand, the company is fighting increased operational expenses because it is still in the early phases of growth. The company’s fiscal third-quarter margins could have been dragged down by higher research and development (R&D) costs.
Furthermore, the company’s earnings may be hampered by continuous supply chain issues as well as fierce competition from competing charging networks supplied by firms such as Tesla (TSLA).
Nonetheless, investors should keep in mind that, given the government’s large financial commitment to developing its EV charging infrastructure, ChargePoint’s earnings may only improve in the near future.
Expert’s Take
Ahead of the fiscal Q3 earnings announcement, Jefferies analyst David Kelley maintained a Buy rating on the stock but decreased the price target to $34.00 from $36.00.
ChargePoint is expected to see robust revenue growth in the upcoming quarter, thanks to “ongoing infrastructure build-out,” “acquisitions,” and “ramping EV & charging momentum,” according to Kelley.
However, owing to “supply chain disruption & ongoing investment in CHPT’s ‘Land & Expand’ infrastructure build-out,” he anticipates margins to remain under pressure.
Wall Street’s Take
On TipRanks, ChargePoint stock commands a Moderate Buy consensus rating, based on 5 Buys and 5 Holds.
As for price targets, the average CHPT price target of $29.11 implies almost 35% upside potential from the current levels.
Disclosure: At the time of publication, Shalu Saraf did not have a position in any of the securities mentioned in this article.
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