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What Could the SemaConnect Buyout Mean for Blink Charging?

Story Highlights

Under government directives, actions are being taken to boost the electric vehicle industry in the U.S. At this juncture, the acquisition of SemaConnect might be advantageous for Blink Charging.

In a bid to expand its business vertically, Blink Charging Co. (NASDAQ: BLNK) has agreed to acquire SemaConnect, Inc. in a cash and stock deal worth $200 million. The completion of the transaction is subject to the fulfillment of customary closing conditions.

Blink Charging views this buyout to be in line with the Biden government’s Buy American initiative and $7.5 billion EV infrastructure bill. Shares of the $642.4-million company grew 5.6% to close at $15.03 on Tuesday.

Inside the Headlines

SemaConnect is well-positioned in the electric vehicle (EV) market, serving customers in retail, municipal, commercial, hotel, and other end markets. It has expertise in manufacturing products like DC Fast chargers (DCFC) and provides network, cable, and load management services.

The manufacturing and R&D capabilities and hardware designs of SemaConnect complement the software solutions of Blink Charging. Also, the acquisition is expected to boost Blink Charging’s geographical footprint and its portfolio by 3,800 site host locations, 13,000 EV charges, and >150,000 EV members (registered).

The Founder and CEO of Blink Charging, Michael D. Farkas, said, “This is a transformative acquisition for the EV charging industry and for Blink.”

Regarding SemaConnect’s efforts to develop DCFC charges, Farkas said that these initiatives “allow Blink to significantly accelerate our DCFC speed to market while drastically reducing our R&D costs.”

Stock Rating

On TipRanks, Blink Charging has a Moderate Buy consensus rating based on two Buys and three Holds. BLNK’s average price target of $29.20 suggests 94.28% upside potential from current levels. Shares of the company have plummeted 62.1% over the past year.

Further, financial bloggers on TipRanks are 91% Bullish on BLNK, compared to the sector average of 65%.

Conclusion

Blink Charging’s initiatives to expand its footprints in the EV industry are appreciable, especially when the government is taking serious actions to build and expand the use of electric vehicles in the country. The buyout of SemaConnect is expected to unleash growth opportunities for Blink Charging in the years ahead.

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