The rapidly evolving EV market continues to fuel growth at ChargePoint Holdings (CHPT), which develops and markets EV charging infrastructure, and provides cloud-based services.
The company recently delivered impressive Q2 Fiscal Year 2022 financial numbers, and raised full-year guidance thanks to the higher demand.
While ChargePoint is successfully growing its scale in both North America and Europe, its stock continues to underperform the broader markets, and is down about 26% since March 1. (See ChargePoint Holdings stock charts on TipRanks)
The weakness in its margins and valuation concerns weighed on its share price. I am neutral on ChargePoint stock.
It’s worth noting that TipRanks’ Stock Investors tool indicates that 1.1% of investors who hold portfolios in TipRanks decreased their exposure to ChargePoint stock over the last seven days. Furthermore, insiders sold 272.6 million shares in the last three months.
While ChargePoint underperforms, Vikram Bagri of Needham maintained a Buy rating on the stock. Bagri sees ChargePoint’s revenue growing at a CAGR of 49% over the next five years. Further, he highlighted ChargePoint’s debt-free balance sheet, and strong cash reserves that could accelerate growth.
ChargePoint expects to report revenue in the range of $225 million to $235 million in Fiscal Year 2022, up 15% from its previous guidance. It projects Q3 revenues of $60 million to $65 million, the midpoint of which reflects a sequential growth of 11.4%.
On TipRanks, ChargePoint has a Moderate Buy consensus rating, based on seven Buys, one Hold, and one Sell. The average ChargePoint Holdings price target of $34.75 implies 56.8% upside potential to current levels.
Disclosure: On the date of publication, Amit Singh had no position in any of the companies discussed in this article.
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