Despite solid demand and government support, the electric vehicle (EV) industry is grappling with supply chain disruptions and semiconductor chip shortages. The lack of enough infrastructure and inoperable charging stations have also been a significant challenge for companies in this space. Given this backdrop, fundamentally-weak EV stocks Rivian Automotive (RIVN), ChargePoint Holdings (CHPT), and EVgo (EVGO) are expected to plummet further in the near term. Read on….
Despite rising demand and the government’s pro-EV initiativesseveral challenges, such as high inflation, semiconductor chip shortages, prolonged supply chain disruptions, and inadequate charging infrastructure, make the industry’s near-term prospects bleak.
Insufficient battery manufacturing capacities and chip shortages hamper production, making it challenging to meet the high demand.
In addition, the lack of enough charging infrastructure, the high upfront cost of EVs, long charging hours, and inoperable charging stations will likely slow down the industry’s growth.
Many EV charging stocks have declined massively in price this year. With the industry expected to face further headwinds in the near term, it could be wise to avoid fundamentally weak EV charging stocks Rivian Automotive, Inc. (RIVN), ChargePoint Holdings, Inc. (CHPT), and EVgo, Inc. (EVGO).
Rivian Automotive, Inc. (RIVN)
Founded in 2009, RIVN is a manufacturer of electric adventure vehicles. Its offerings include electric SUVs and passenger pickup vehicles designed for both on- and off-road driving. Recently it launched its R1 platform, a two-row five-passenger pickup truck.
For the fiscal second quarter ended June 30, 2022, RIVN’s total operating expenses increased 73.1% year-over-year to $1 billion. The company’s loss from operations widened 194.5% year-over-year to $1.71 billion. Also, its net loss came in at $1.71 billion, widening 195.2% from the year-ago period. In addition, its net loss per share narrowed 67.1% year-over-year to $1.89.
Street expects the company’s EPS to be negative in fiscal 2022. Shares of RIVN have declined 69% year-to-date to close the last trading session at $32.07.
RIVN’s POWR Ratings are consistent with this bleak outlook. It has an overall F rating, equating to a Strong Sell in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
It has an F grade for Value, Stability, and Quality and a D for Sentiment. Among 65 stocks in the Auto & Vehicle Manufacturers industry, it is ranked #61. To see the other rating of RIVN for Growth and Momentum, click here.
ChargePoint Holdings, Inc. (CHPT)
CHPT operates electric vehicle charging networks and charging solutions globally. It offers a portfolio of hardware, software, and services for commercial, fleet, and residential customers. The company has delivered more than 123 million charging sessions year-to-date, with drivers plugging into its network on average every second.
CHPT’s total operating expenses increased 27.6% year-over-year to $108.52 million in the second quarter ended July 31, 2022. The company’s loss from operations widened 21.6% year-over-year to $90.37 million. Its non-GAAP net loss widened 53.1% from the prior-year quarter to $61.86 million. Also, its loss per share narrowed 3.4% year-over-year to $0.28.
Analysts expect CHPT’s EPS to remain negative for fiscal 2022 and 2023. The stock has declined 23.8% year-to-date to close the last trading session at $14.50.
CHPT’s weak fundamentals are reflected in its POWR Ratings. It has an overall F rating, equating to a Strong Sell in our proprietary rating system.
It has an F grade for Value and Stability and a D for Quality. It is ranked #81 out of 92 stocks in the Industrial – Equipment industry. Click here to see the other ratings of CHPT for Growth, Momentum, and Sentiment.
EVgo, Inc. (EVGO)
EVGO owns and operates a direct current fast charging network in the United States. The company offers electricity directly to drivers, original equipment manufacturer charging and related services, fleet and rideshare public charging services, and dedicated fleet charging services. As of June 30, 2022, with more than 850 charging locations, the company has served over 60 metropolitan areas across 30 states and nearly 444,000 customer accounts.
For the second fiscal quarter (ended June 30, 2022), EVGO’s total operating expenses increased 128.6% year-over-year to $36.31 million. The company’s gross loss narrowed 55.5% year-over-year to $0.74 million, while its operating loss widened 111% from its year-ago value to $37.05 million. Also, its adjusted EBITDA loss widened by 80.2% from its prior-year period to $19.84 million.
For fiscal 2022, EVGO’s EPS is expected to remain negative. The stock has lost 10.6% year-to-date to close the last trading session at $8.88.
EVGO’s POWR Ratings reflect bleak prospects. It has an overall F rating, equating to a Strong Sell in our proprietary rating system.
It has an F grade for Stability and a D for Growth, Value, Sentiment, and Quality. Within the Industrial – Equipment industry, it is ranked #86. To see the other rating of EVGO for Momentum, click here.
RIVN shares were trading at $33.10 per share on Tuesday morning, up $1.03 (+3.21%). Year-to-date, RIVN has declined -68.08%, versus a -17.43% rise in the benchmark S&P 500 index during the same period.
About the Author: Shweta Kumari
Shweta’s profound interest in financial research and quantitative analysis led her to pursue a career as an investment analyst. She uses her knowledge to help retail investors make educated investment decisions.
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