Chargepoint’s Guidance Just Keeps Getting Better and Better
InvestorPlace - Stock Market News, Stock Advice & Trading Tips CHPT stock may have lost 27% over the last three months, but the company's strong g...
A couple of months ago, I used this space to write about Chargepoint (NYSE:CHPT). The company’s optimistic guidance was one of the top reasons to consider CHPT stock in the fast-growing electric vehicle (EV) space.
Now, the company has finally released its second-quarter earnings report — and the bullish thesis continues to hold fast.
In fact, in issuing earnings, Chargepoint actually increased its full-year guidance. Specifically, it cited significant growth in North America and Europe.
That’s more than just pure optimism. There’s a clear bull case for CHPT stock right now. When it comes down to it, this name is one of the best ways to capitalize on the powerful growth we should see in the EV space for the next decade.
CHPT Stock: A Solid Q2 Report
For Q2, Chargepoint reported revenue of $56.1 million, which was an increase of 61% from a year ago. Just as significantly, network charging revenue increased by 91% on a year-over-year (YOY) basis, rising from $21.4 million to $40.9 million.
That said, non-GAAP losses for the quarter also increased from a year ago. The company said it lost $40.4 million versus $22.6 million in the prior year. That equates to a loss of 29 cents per share, which was more than the 13-cent earnings per share (EPS) loss that analysts had expected. However, Chargepoint still had $618.5 million in cash on hand at the end of the quarter.
But now for the good stuff. CHPT said that it expects to bring in revenue of $60 million to $65 million in Q3, a significant increase YOY. On top of that, the company also increased its full-year guidance to a range of $225 million to $235 million in revenue. That’s up from its previous projection of $195 million to $205 million. Chargepoint President and CEO Pasquale Romano said it was a strong quarter altogether.
“The results from this quarter can be described with one word: scale, scale across our three verticals and scale in both North America and Europe. We are a larger company than we were pre-COVID and growing more quickly.”
The Winds of Change
In a conference call with industry analysts, Romano astutely described Chargepoint’s future as being tied directly to growth in the EV market. He cited a BloombergNEF report that showed North American sales of electric vehicles rose 97% in the first half of the year from 2020. Moreover, in Europe, sales growth was even faster; EV sales were up 153% for the same period.
But that’s not all. Romano noted that Chargepoint is also buoyed in the U.S. by an executive order from President Joe Biden. The order requires half of all new vehicles sold by 2030 to be zero-emission vehicles. Similarly, the European Union (EU) wants “55% emission reduction” by 2030. Meanwhile, Canada is pushing for 100% of its vehicles sold to be zero-emission by 2035.
All of that plays directly into the strengths of CHPT stock.
The Bottom Line on CHPT Stock
Chargepoint hasn’t been around for long. The company began trading in March after a merger with a shell company.
Yet, even though CHPT stock is down roughly 27% in the last three months, the company’s growth story and tremendous potential in the EV space is crystal clear.
Drivers are already plugging into the Chargepoint network, which includes about 18,000 locations throughout North America and Europe. As passenger vehicles, buses and delivery vans start to spurn gasoline in favor of zero-emission fuel, the company will be more than ready to further capitalize on the trend.
CHPT stock has a “B” rating and a buy recommendation in my Portfolio Grader.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
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