Blink Charging vs. ChargePoint: Which EV Charging Stock Could Fetch Higher Returns?

As the adoption of electric vehicles (EV) is rising, the demand for EV charging stations is also rising. According to a Fortune Business Insights report, the global EV charging station market was worth $39.70 billion in 2019 and is expected to reach $100.96 billion by 2027, indicating a compounded annual growth rate (CAGR) of 23.24% .

Using the TipRanks Stock Comparison tool, let us compare two EV charging station companies, Blink Charging Co. and ChargePoint Holdings, and see how Wall Street analysts feel about these stocks.

Blink Charging Co. (BLNK)

Blink Charging Co. is the owner, operator and provider of EV charging equipment and services. The company’s principal products and services include its Blink EV charging network, EV charging equipment, and charging services.

In the first quarter, the company’s revenues jumped 72% year-over-year to $2.2 million. However, BLNK’s net loss per share widened to $0.18 in Q1 from $0.11 per share in the same quarter last year.

According to BLNK, the demand for EVs has been spurred by government initiatives as U.S states like California, Oregon, New York, Maryland, and Massachusetts aim to have 6.8 million EVs on the road by 2030.

Following the earnings, H.C. Wainwright analyst Sameer Joshi reiterated a Hold on the stock. The analyst noted in a research note to investors, “We continue to believe that Blink’s: (1) owned-operated installed base; (2) strategic partnerships; and (3) flexible business model, positions the company strongly to be a leader in the electric vehicle charging infrastructure space.”

Last month, the company acquired Belgium-based EV charging operator Blue Corner N.V. for $24 million in a cash and stock deal. The deal expands Blink’s EV portfolio in the growing European EV market as Blue Corner has a portfolio of 7,071 charging ports with a strong charging network in Europe. (See Blink Charging Co. stock chart on TipRanks)

Joshi commented that this acquisition “could prove to be accretive as a result of: (1) higher concentration of EVs in Europe; and (2) faster growth of EV sales in Europe where sales grew 137% to 1.4M EVs sold last year, compared to 4% growth to 328K vehicles sold in the U.S.”

The analyst also said that according to the company, product costs and installation and deployment expenses are lower in Europe than in the U.S. Joshi believes that this could “result in faster return on investment for future charging station installations.”

Joshi is of the view that operating expenses for the company could rise in the coming quarters, mainly due to acquisitions that were closed in the last few quarters.

The analyst added, “We also expect to see more strategic expansion, either through acquisitions or partnerships in Europe, Latin America, as well as in the U.S. In our opinion, Blink is well positioned domestically to capitalize on the expected expansion of EV charging infrastructure with the U.S. push to install 500,000 charging stations over the next decade.”

Consensus among analysts on Wall Street is a Moderate Buy based on 2 Buys and 1 Hold. The average analyst BLNK price target of $38 implies approximately 4.3% downside potential to current levels.

ChargePoint Holdings (CHPT)

ChargePoint Holdings has a comprehensive EV charging network and a portfolio of EV charging solutions in North America and Europe. In the first quarter of FY22, CHPT posted revenues of $40.5 million, up 24% year-over-year. The company incurred a loss of $0.84 per share in Q1 compared to the $0.10 loss per share estimated by analysts.

For Q2, the company expects revenues to range between $46 million to $51 million. For FY22, CHPT has forecast revenues between $195 million and $205 million. (See ChargePoint Holdings stock charts on TipRanks)

Last week, Oppenheimer analyst Colin Rusch interacted with the company’s management. Rusch assigned a Buy rating with a price target of $39 (32.7% upside) on the stock.

The analyst said, “We believe its in-field experience and multiple learning cycles with customers have enabled the company to maintain its dominant US market position and outpace EU [European Union] competitors. With a fully funded business model and accelerating EV production schedules, we remain constructive on shares.”

The company provides EV charging system infrastructure that is connected in a network and cloud-based service. That service enables consumers to locate, reserve, authenticate and transact EV charging sessions.

As a part of these services, it provides an open platform that integrates with CHPT’s system hardware and hardware from other manufacturers. This platform connects systems over a network that provides real-time information about charging sessions and full control, support, and management of the networked charging systems.

Rusch commented about this networked infrastructure, “Management continues to view the integration of software within their hardware as a key differentiator, enabling secondary functionality that adds value to the charging process. Benefits include being able to fully tailor aesthetics and provide a consistent UI as well as facilitate a more streamlined user experience, all while enjoying a lower cost structure associated with ongoing hardware support.”

The analyst added that CHPT continues to bundle its software with its hardware, in addition to standalone software sales. As a result, software could become a key driver of recurring revenues for the company.

The company provides different kinds of chargers including commercial Level 2 Alternating Current (AC) chargers, chargers for use at home, and high-power Level 3 Direct Current (DC) Fast chargers for urban fast charging, corridor or long trip charging, and fleet applications.

Rusch said that the company foresees “overarching non-home port density of ~15 chargers per 100 vehicles.” The analyst added that this indicates approximately 15-20 ports per 100 cars in North America, with density in the low 20s per 100 vehicles for the EU.

The analyst commented, “Going forward, outside of novel architecture introductions, the company will look to continue its iterative and modular hardware design approach.”

Consensus among analysts on Wall Street is a Moderate Buy based on 1 Buy and 1 Hold. The average analyst CHPT price target of $33.50 implies approximately 14% upside potential to current levels.

Bottom Line

Based on the upside potential over the next 12 months, CHPT seems to be a better Buy.

Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.