Whether you like electric vehicles or not, it’s hard to deny that we’re seeing more and more of them on the road. Even manufacturers known for producing V8s in the old days are now electrifying their fleets.
The reason is not just consumer preference. Regulations also play a critical role.
California, for example, is expected to approve a plan to end sales of gasoline-powered vehicles over the next 13 years. The plan will set interim targets for the phasing out of new petrol cars and a total ban on their sale by 2035.
California Air Resources Board board member Daniel Sperling tells CNN the measure is “monumental.”
Meanwhile, California Governor Gavin Newsom called the plan “one of the most important steps to end vaping as we know it.”
Other states typically follow California’s lead in implementing auto emissions regulations.
For traditional automakers, it’s not good news. For EV stocks, on the other hand, it could serve as a powerful catalyst.
ChargePoint Holdings (CHPT)
ChargePoint Holdings is firmly positioned for the EV boom.
The company has one of the largest EV charging networks in the world. It has approximately 5,000 commercial and fleet customers, including 78% of Fortune 50 companies. Since its inception, ChargePoint has delivered more than 123 million charging sessions.
Of course, EV stocks haven’t been a market favorite this year, and this EV infrastructure play has also found itself in the sell-off. Shares of ChargePoint are down 31% over the past 12 months.
This could give bargain hunters something to think about.
In the fiscal quarter ended April 30, ChargePoint generated $81.6 million in revenue, up 102% year over year. This was driven by a 122% increase in network fee revenue and a 63% increase in subscription revenue.
JPMorgan analyst Bill Peterson recently reiterated an “overweight” rating on ChargePoint and raised his price target to $20 — about 30% above where the stock sits today.
Charging Flashes (BLNK)
With a market cap of around $1.1 billion, Blink Charging is a relatively unfollowed name in the world of EV stocks.
However, it has offered very generous returns to previous investors.
In early 2020, Blink Charging was trading at less than $2 per share. Today, it’s at $22.69. You do the math.
As the company name suggests, it focuses on the billing side of the business.
Blink has deployed more than 51,000 EV charging ports and has over 423,000 registered users. It uses a proprietary software that operates, maintains and monitors the EV stations connected to its network.
In the first half of 2022, revenue rose 223% from a year ago to $21.3 million.
The growing adoption of electric vehicles will continue to fuel the massive growth of Blink’s business.
Needham & Company analyst Vikram Bagri has a “buy” rating on Blink and a $27 price target – suggesting a potential upside of 19%.
A list of EV stocks for the future wouldn’t be complete without Tesla.
The electric vehicle maker has been in the headlines lately for completing a three-for-one stock split. By splitting a stock into smaller pieces, each piece will have a lower, more affordable price. These small stocks often attract more interest from retail investors. However, note that a split does not change a company’s underlying fundamentals.
And fundamentals still appeal to growth investors.
In the second quarter, the company delivered 254,695 vehicles, representing a 27% year-over-year increase. Production totaled 258,580 vehicles, up 25% from a year ago.
Tesla’s auto revenue rose 43% year over year to $14.6 billion for the quarter. Total revenue rose 42% to $16.9 billion.
Wedbush analyst Dan Ives recently raised his price target on Tesla while maintaining an “outperform” rating.
“We adjust our price target of $1,000 pre-split ($333 post-split) to $360, reflecting the 3:1 split as well as Tesla’s improved production from its core China Giga plant during the September quarter with clear momentum towards the end of the year,” he tweeted.
Considering that Tesla is currently trading at $295 per share, Ives’ new price target suggests a potential upside of 22%.
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This article provides information only and should not be construed as advice. Provided without warranty of any kind.