Shares of EV charging equipment maker ChargePoint are falling after disappointing quarterly earnings. The company has sales growth, but not enough for investors.
Wednesday evening, Chargepoint (ticker: CHPT) reported A loss of 24 cents per share on sales of $150.5 million. A year ago, ChargePoint reported a 19-percent loss on sales of $108.3 million.
“In the second quarter, ChargePoint delivered solid growth. Despite a sluggish economy, our revenue of $150 million represented a 39% year-over-year increase,” CEO Pasquale “Pat” Romano said in a news release.
Solid expansion, but below Wall Street expectations. Analysts had expected a 13-percent loss on sales of $153.2 million.
Guidance is below the Street consensus. Looking ahead, ChargePoint expects to generate between $150 million and $165 million in third-quarter sales. Wall Street is predicting about $178 million. For the full year, the company expects sales of $605 million to $630 million. Wall Street was predicting about $667 million.
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Shares fell 10.6% to $6.31 in premarket trading, while S&P 500 and Nasdaq Composite futures fell 0.3% and 0.6%, respectively.
“We were expecting near-term headwinds…chargepoints [guides] was below our revised expectations,” JP Morgan analyst Bill Peterson wrote in a report Thursday. „Growth is still being held back by reduced discretionary spending in some markets, and fleet growth is being held back by a shortage of vehicles.”
He still rates the stock a buy, calling ChargePoint the North American EV charging leader, but raised his price target to $10 from $13. Stifel analyst Stephen Gengaro also rates the stock a buy. He maintained his price target at $17.
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„The lower guidance is due to near-term macro headwinds, and while we remain confident in ChargePoint’s business strategy, we expect the stock to remain weak following the results and outlook,” Gengaro wrote Wednesday evening. „On a positive note, the long-term story appears to be the same.”
He pointed to management’s plan to generate positive adjusted earnings before interest, tax, depreciation and amortization.
As of July 31, 2023, the company has $263.9 million in cash on the books. Wall Street projects that ChargePoint will use about $110 million to build its business in the final two quarters of its 2024 fiscal year, which ends in January, and about $170 million in the coming 2025 fiscal year.
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As of Thursday’s trading, ChargePoint stock was down about 26% since Jan. 1 and 56% over the past 12 months. Rising interest rates and a sluggish economy have dampened investor interest in startup stocks.
Write to Al Root at [email protected]
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