The House passed a more than $1 trillion bipartisan infrastructure bill on Friday, November 5. In alignment with President Biden’s push for half of new auto sales in the nation to be electric vehicles (EVs) by 2030 given the current climate crisis, the bill has allotted $7.50 billion for creating a country-wide network of EV charging stations.
The spending bill will contribute to building 500,000 EV charging units and allocates $65 billion for upgrading the nation’s electrical grid. Furthermore, President Biden’s proposed broader Build Back Better plan has more provisions for tax credits for union-built EVs. According to a Verified Market Research report, the global EV charging stations market size is expected to reach $32.34 billion by 2028, growing at a 33.6% CAGR of 33.6%.
Driven by investors’ optimism, popular EV charging-related stocks, EVgo, Inc. (EVGO), Volta Inc. (VLTA), and Blink Charging Co. (BLNK) have rallied in price since the passage of the infrastructure bill.
EVgo, Inc. (EVGO)
Los Angeles-based EVGO is the owner and operator of a direct, current, and fast battery charging network in the United States. The company went public after a business combination with Climate Change Crisis Real Impact I Acquisition Corporation on July 2, 2021.
On November 9, EVGO announced an expansion of its EV charging program by partnering with Uber Technologies, Inc. (UBER) to include rideshare customers on the UBER platform. Regarding the partnership, Cathy Zoi, CEO at EVGO, said, “We are excited to see more rideshare drivers making the switch to electric and look forward to providing fast charging for high volume rideshare drivers and decarbonizing this growing segment of transportation.”
Also in November, EVGO and General Motors Co. (GM) announced the expansion of their collaborative fast-charging infrastructure build-out. The companies are planning to build 3,250 high-powered DC fast-charging stalls through 2025.
For its fiscal third quarter. ended September 30, EVGO’s revenue increased 73% year-over-year to $6.18 million. Its adjusted gross profit improved 1,342.1% from the prior-year quarter to $1.37 million. And its adjusted gross margin rose 19.5 percentage points from the same period last year to 22.2%.
The Street expects EVGO’s EPS to increase 17.1% year-over-year in the next year (fiscal 2022). Likewise, the $52.28 million consensus revenue for the coming year indicates a 159.6% rise from the current.
The stock has gained 31.6% in price since the company went public on July 2 and 138.3% over the past month to close Friday’s trading session at $18.90. It has gained 90.9% since the passing of the infrastructure bill on November 5.
Volta Inc. (VLTA)
VLTA operates a network of EV charging stations. The New York City company takes a data-based approach to providing services to customers by placing its stations in their places of convenience. VLTA went public through a reverse merger with a SPAC Tortoise Acquisition Corp. II on August 27, 2021.
On November 2, VLTA announced a partnership with global sports and entertainment company Topgolf Entertainment Group to add electric charging stations in select venues across the United States. The company expects to profit from placing charging stations in strategic locations, to support the growth of EV adoption.
In October, the company collaborated with hard-surface flooring specialty retailer Floor & Decor to provide accessible EV charging at the latter’s warehouses across the country. The stations are expected to be in place by 2021, with more stations set to be placed in 2022. This should add to VLTA’s revenue stream.
VLTA’s revenue increased 77.1% year-over-year to $8.49 million in its third fiscal quarter, ended September 30. For the nine months ended September 30, the company’s cash and cash equivalents balance came in at $331.25 million, up 3,022.4% from the same period last year, while its net cash provided by financing activities climbed 541.4% year-over-year to $357.64 million.
Analysts expect VLTA’s EPS to increase 62.2% year-over-year in the next year (fiscal 2022). The Street’s $95.30 million revenue estimate for the coming year reflects a 177.7% improvement from the current year.
VLTA’s stock has gained 36.7% in price since it went public on August 27 to close Friday’s trading session at $12.71. It has gained 13.6% in price over the past five days and 36.7% since November 5.
Blink Charging Co. (BLNK)
BLNK is the owner, operator, and provider of EV charging equipment and networked EV charging services. The Hollywood, Fla., company’s offerings include residential and commercial EV charging equipment and remote monitoring of charging stations.
On October 7, BLNK announced the sale of 64 residential charging stations to automotive performance parts firm Rudy’s Performance Parts, to be resold across Rudy’s distributive channels. The sale should generate significant cash inflow for the company.
On October 5, BLNK announced the expansion of its car-sharing program in Los Angeles, following a Los Angeles Council vote. Regarding the expansion, Michael D. Farkas, Chief Executive Officer of Blink Charging, stated, “We’re very pleased to expand our exclusive car sharing and EV charging agreement with the city of Los Angeles. The program further reinforces our commitment to providing affordable electric vehicle accessibility and EV charging infrastructure to underserved communities across the city.”
For its third fiscal quarter, ended September 30, BLNK’s total revenues increased 606.6% year-over-year to $6.40 million. This can be attributed to a 766.1% in product sales from the prior-year quarter to $4.82 million. And for the nine months ended September 30, the company’s cash and cash equivalents balance improved 794.6% from the same period last year to $133.23 million.
The Street expects BLNK’s EPS to improve 11.4% year-over-year in the next year (fiscal 2022). Likewise, the $28.96 million consensus revenue estimate for the coming year indicates a 71.1% rise from the current year.
BLNK’s stock has gained 312.5% in price over the past year and 39.4% over the past month to close Friday’s trading session at $40.01. It has gained 25.1% since November 5.
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EVGO shares were trading at $16.10 per share on Monday afternoon, down $2.80 (-14.81%). Year-to-date, EVGO has gained 50.33%, versus a 26.13% rise in the benchmark S&P 500 index during the same period.
About the Author: Anushka Dutta
Anushka is an analyst whose interest in understanding the impact of broader economic changes on financial markets motivated her to pursue a career in investment research. More...
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