Last month, the U.S. House of Representatives passed the $1.75 trillion Build Back Better Act, which includes tax incentives of up to $12,500 per vehicle to spur consumer demand for electric vehicles (EVs). This initiative was formulated to reduce greenhouse gas emissions and achieve climate targets.

However, yesterday, Sen. Joe Manchin, a conservative Democrat, said he would not vote for the Build Back Better Act. Democrats need Manchin’s vote in the 50-50 Senate. Because his decision could ruin the $1.75 trillion social spending and climate policy bill, the EV industry could suffer from low demand absent the tax incentives. A new study from the economic consulting firm Anderson Economic Group (AEG) stated that electric vehicles could be more expensive to fuel than their internal combustion engine counterparts.

Given this scenario, we think it could be wise to avoid fundamentally weak EV charging stocks ChargePoint Holdings, Inc. (CHPT), Blink Charging Co. (BLNK), and EVgo, Inc. (EVGO).

ChargePoint Holdings, Inc. (CHPT)

CHPT provides electric vehicle (EV) charging networks and charging solutions in the United States. The Campbell, Calif.-based company enables consumers to locate, reserve, authenticate and transact EV charging sessions. CHPT also offers a portfolio of hardware, software, and services for commercial, fleet, and residential customers

CHPT’s total revenue increased 78.8% year-over-year to $65.03 million in its fiscal third quarter, ended October 31, 2021. However, the company’s total operating expenses grew 104.3% from their year-ago value to $81.38 million. Its loss from operations rose 100.4% from the prior-year quarter to $65.32 million. Also, the company’s net loss increased 69.8% year-over-year to $69.44 million.

CHPT has failed to beat the consensus EPS estimates in each of the trailing four quarters. Its EPS is expected to decrease 80.2% per annum over the next five years. The stock has declined 46.4% in price over the past year and 52.5% year-to-date.

CHPT’s POWR Ratings are consistent with this bleak outlook. The stock has an overall F rating, which equates to a Strong Sell in our proprietary rating system. The POWR Ratings assess stocks by 118 distinct factors, each with its own weighting.

Also, the stock has an F grade for Value, Stability, and Sentiment. We have also graded CHPT for Growth, Momentum, and Quality. Click here to access all CHPT’s ratings. CHPT is ranked #83 of  92 stocks in the C-rated Industrial – Equipment industry.

Click here to check out our Industrial Sector Report 

Blink Charging Co. (BLNK)

Hollywood, Fla.-based BLNK, through its subsidiaries, owns and operates electric vehicle (EV) charging equipment and networked EV charging services in the United States. The company offers residential and commercial EV charging equipment, enabling EV drivers to recharge at various location types. As of December 31, 2020, it deployed approximately 16,617 EV charging stations.

During the third quarter, ended September 30, 2021, BLNK’s revenue increased 606.6% year-over-year to $6.4 million. However, the company’s total operating expenses grew 290.5% from its  year-ago value to $16.72 million. Its loss from operations rose 304.4% from the prior-year quarter to $15.82 million. Also, the company’s net loss increased 291.4% year-over-year to $15.32 million.

BLNK has failed to beat the consensus EPS estimates in each of the trailing four quarters. Its EPS is estimated to decrease 111.9% in the current year. The stock has declined  38.9% in price over the past month.

BLNK’s poor prospects are also apparent in its POWR Ratings. The stock has an overall F rating, which equates to a Strong Sell in our proprietary rating system. Also, the stock has an F grade for Value, Stability, and Quality.

In addition to the POWR Rating grades I have just highlighted, one can see BLNK’s ratings for Sentiment, Growth, and Momentum here. BLNK is ranked last in the Industrial – Equipment  industry.

EVgo, Inc. (EVGO)

EVGO is a public fast-charging network for electric vehicles (EVs). As of October 26, 2021, the Los Angeles-based company operated approximately 800 DCFC locations in around 68 metropolitan areas across 35 states serving approximately 300,000 private and commercial EV drivers. EVGO also offers its services to EV drivers, business owners, policymakers, fleets, and automakers.

For the third quarter, ended September 30, 2021, EVGO’s total revenue increased 73% year-over-year to $6.18 million. However, the company’s total operating expenses grew 131.9% from its  year-ago value to $24.28 million. Its operating loss rose 99.2% from the prior-year quarter to $25.93 million. Also, the company’s interest expense came in at $33,000 during the period.

EVGO’s EPS is expected to decline 53.6% next year. The stock has declined 32.9% in price over the past month.

It is no surprise that EVGO has an overall F rating, which equates to a Strong Sell in our POWR Rating system. Also, the stock has an F grade for Value and Stability.

Click here to see the additional POWR Ratings for EVGO (Momentum, Growth, Sentiment, and Quality). EVGO is ranked #79 in the Industrial – Equipment industry.

CHPT shares were trading at $18.05 per share on Monday morning, down $0.98 (-5.15%). Year-to-date, CHPT has declined -54.97%, versus a 22.06% rise in the benchmark S&P 500 index during the same period.

About the Author: Priyanka Mandal

Priyanka is a passionate investment analyst and financial journalist. After earning a master's degree in economics, her interest in financial markets motivated her to begin her career in investment research. More...

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