Buy these 2 EV charging stocks, says Needham, forecasts up more than 50%

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While vehicles (EVs) are currently a small part of the world’s auto fleet, their numbers are on the rise. EVs are benefiting from a mix of tailwinds including improved technologies, social acceptance and political will to give the EV industry a strong momentum.

The rapid expansion of EVs has opened up vast avenues of opportunity for investors. While carmakers try to grab headlines (think Elon MuskKey Tesla), there are also companies working on charging stations, battery technology and production, and further back in the supply chain, lithium mining. These offer investors to capitalize on the growth of EVs.

With all this as a backdrop, we’ve dug open the TipRanks database and pulled the details on two EV charging stocks that investment firm Needham recently tagged as potential for the year ahead. Both are bi-rated names with a probability of over 50%. Let’s see what’s behind this confident move.

solid power ,SLDP,

First up is Solid Power, an industry leader working on all-solid-state technology for battery charging systems. This is a new frontier in battery technology, and if successfully developed into practical applications, would provide serious advantages over current liquid-based lithium-ion batteries. These benefits will include higher power density, longer battery life-span, greater safety and long-term cost savings.

The technology the company is using to develop and realize these benefits is based on solid sulfide electrolytes, a new battery design that will allow for higher charge rates with lower temperatures, while allowing for higher charge rates than lithium in current systems. And avoids rising costs.

Meanwhile, Solid Power is working to be ready as the battery and charging sectors take off in the next few years. The company went public in December of 2021 and has seen a gradual increase in quarterly revenue since then. Those revenues are still modest, as the company hasn’t entered full production yet, but we can get a good feel for where the company stands by looking at its 2022 financial results.

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Initially, Solid Power said it remains on track to open its electrolyte production facility during Q1 23, a key milestone in achieving full production. The company will start production of EV cells in the last quarter of 2022, and is expected to start deliveries to partners this year. Solid Power has strengthened its existing relationship with BMW through the extension of the two companies’ partnership agreement.

Solid Power saw total revenue of $11.8 million last year, a 29% year-over-year increase from its reported top line of $9.1 million in 2021. of $50.1 million by December 31, 2022.

Needham analyst Chris Pierce takes a detailed look at this company, and sees it in a strong position for the foreseeable future.

“We view SLDP as a well-funded call option on the future of solid state batteries in vehicles,” Pierce wrote. “The potential advantages of solid state battery technology over current lithium-ion battery technology are clearly evident, and SLDP has participation and investment from two auto OEMs (F and BMW) at opposite ends of the consumer spectrum. We see two compelling avenues SLDP is following a capex-lite licensing model for its battery technology, as well as developing a sulfide-based electrolyte that can be a raw material input for any OEM or battery manufacturer that wants to develop its own battery technology. wants to develop its own solid state battery.

In Pierce’s view, this justifies a Buy rating on SLDP shares with a $5 price target indicating confidence in a strong 80% upside potential for the next 12 months. (To see Pierce’s track record, Click here,

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Overall, Solid Power has garnered two other recent analyst reviews that remain on the fence for now, all coupled with a Moderate Buy consensus rating. An average price target of $4 indicates one year gains of 44% from the current share price of $2.77. (Look sldp stock analysis,

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Chargepoint Holdings ,Chapter,

The second stock we’ll look at, ChargePoint, is an industry leader in the EV charging niche. ChargePoint operates in both North and Europe and has over 225,000 charging points on its network. The company claims a 70% market share in the Level 2 charging market in North America, giving it a powerful advantage over even its closest competitor. ChargePoint has over 5000 fleet and commercial customers worldwide.

The world’s EV fleet is growing, demand for charging stations is on the rise, and ChargePoint has built up steady quarterly revenue to show since going public two years ago; In fact, the company has grown revenue for seven consecutive quarters. Last quarter’s results released, 4Q of FY2023 earlier this month showed a top line of $152.8 million for a 93% y/y gain. This included revenue from network charging systems of $122.3 million (up 109% y/y) and subscription revenue of $25.7 million (up 50% y/y). ChargePoint’s full year revenue for FY ’23 came in at $468 million, which translated into an Y/Y gain of 94%.

ChargePoint projects massive net losses for FY2023 totaling $344.5 million. This compares unfavorably to a net of $132.2 million in FY2022. Nevertheless, the Company had $399.5 million of available liquidity as of January 31, 2023. Despite the large revenue gains, the company didn’t meet expectations on both top- and bottom-line metrics.

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However, Needham’s Chris Pearce hasn’t dampened the enthusiasm. He writes to make a strong case for supporting this stock: “We’re bullish on CHPT as it continues to be the dominant player in EV charging at a time when EV adoption for consumers and fleets is accelerating. CHPT is the industry’s most Clean runs a business model that, in our view, sells hardware directly to site owners for revenue, and a trail of subscription revenue for system software and maintenance that earns deferred revenue based on contract length.

“We like the capital-lite model of CHPT, which utilizes vertical integration versus contract manufacturers. Importantly, the CHPT does not attempt to monetize the drivers by selling electricity directly. We think investors will support this clean/fast approach to shareholder returns, and given CHPT’s market position, we think clients prefer this model as well, validating CHPT’s future growth potential. Pierce said.

Overall, Pierce has ChargePoint a Buy rating with a $14 price target that suggests 51% upside potential over the one-year time-horizon.

In total, ChargePoint’s stock has 7 recent analyst reviews, and these break down 5 to 2 in favor of Buys over Holds for a Moderate Buy consensus rating. Shares are selling for $9.26 and their average price target of $16.57 indicates strong gains of ~79% over the next 12 months. (Look chpt stock analysis,

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To find great ideas for stocks trading at attractive valuations, visit TipRanks. best stocks to buyOne tool that brings together all the Equity Insights from TipRanks.

disclaimer: The views expressed in this article are those of select analysts only. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.