The Electric Vehicle Revolution: A New Era of Growth
The electric vehicle (EV) market has come a long way, and Tesla is undoubtedly a pioneer in this space. However, as the industry continues to evolve, other players are emerging as compelling investment opportunities. One such company is ChargePoint Holdings, a leading provider of EV-charging solutions.
A Dominant Player in the EV-Charging Space
ChargePoint’s technology is used in over half of the 69,632 electric vehicle charging stations in the United States, and it has a significant presence in Europe as well. The company’s business model is centered around monetizing the chief recurring consumable of the EV movement. By working with businesses and owners of electric vehicle fleets, ChargePoint provides private charging solutions, catering to a wide range of customers.
A Growing Market with Tremendous Potential
BloombergNEF predicts that annual EV sales will nearly double between now and 2027, reaching 30 million units. This growth will significantly increase the demand for charging solutions, with Straits Research forecasting a 23% annualized growth rate for the worldwide electric vehicle charging infrastructure market through 2033. ChargePoint Holdings is well-positioned to benefit from this prolonged tailwind.
A Compelling Investment Opportunity
Despite its promising outlook, ChargePoint’s stock has been undervalued, trading at a discount. The company’s revenue is expected to grow nearly 20% for the year ahead, and analysts predict it will reach net-profitability in calendar 2027. While the stock may be volatile, the underlying business has tremendous potential for sustained growth.
A Word of Caution
Investors should be aware that ChargePoint’s stock has been affected by historical psychological baggage, which may make it difficult to shake off. Additionally, the company’s small market cap keeps it off many would-be buyers’ radars. However, for risk-tolerant investors willing to keep a close eye on the company, there is a bullish case to be made for adding ChargePoint to their portfolio.
Before You Invest
Remember that ChargePoint wasn’t one of The Motley Fool’s top 10 stock picks for investors to buy now. However, if you’re willing to take on the risk, ChargePoint could be a valuable addition to your portfolio. Just be sure to limit your initial position and keep a close eye on the company’s progress.
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