President Biden's administration has announced a $7.5 billion plan to expand electric vehicle charging stations to underserved areas. It's part of Biden's agenda to curb greenhouse gas emissions and climate change.
As part of the American Jobs Plan, the Biden administration announced that it aims to build a national public charging network of 500,000 EVSE ports by 2030. According to the Department of Energy, the U.S. will need to build almost 11,500 public EV charging stations per quarter over the next nine years to achieve the government's target by 2030.
EV charging stocks may see immense growth potential due to an infrastructure boost. Does that mean you should jump on EV charging stocks? Let's find out and go over a few stocks you may want to consider adding to your portfolio.
Quick Overview About EV Chargers
First, a quick lesson on EV chargers. (You've gotta understand what you're investing in!) We classify EV chargers in three categories: Level 1, Level 2 and DC fast chargers.
- Level 1 chargers: Level 1 chargers use a regular 110-volt outlet like standard home plugs but take longer to charge.
- Level 2 chargers: Level 2 chargers have a higher-power output and use a 240-volt outlet like you'd see on a clothes dryer or air conditioner. You can get an electric vehicle charged up in about five hours with this type of charger.
- DC fast chargers: DC fast chargers allow direct current into the battery without converting from alternating current. DCFC uses a 480-volt outlet and charge an electric vehicle in an hour.
The United States has about 43,000 public EV charging stations total, which you can locate by state and around 120,000 charging ports, according to the U.S. Department of Energy data. Most of these are Level 2 chargers.
Current charging infrastructure generally falls into the following categories:
- Public: EV charging stations are located in publicly accessible areas or along highway corridors.
- Workplace: Employees can charge their electric vehicles at work during the workday with these chargers.
- Commercial/fleet: Commercial/fleet charging includes charging for electric fleet vehicles, including municipal/private fleets, car sharing and through transportation network companies.
Best EV Charging Stocks to Invest in Now
Let's take a look at the best EV charging stocks you may want to consider right now.
ChargePoint Holdings Inc., headquartered in Campbell, California, provides electric vehicle (EV) charging networks and charging solutions with a portfolio of hardware, software and other services for commercial, fleet and residential customers. ChargePoint has about 163,000 charging ports globally, including 45,000 in Europe.
ChargePoint Holdings Inc. stock fell more than 50% in 2021 but rose nearly 300% in the second half of 2020. The company's Q3 earnings revenues increased by 79% year-over-year (YOY) in 2021. Its biggest goal is to become profitable and, unfortunately, reported $69.4 million in expenses in Q3 2021. The company doesn't expect to generate positive earnings before interest, taxes, depreciation and amortization (EBITDA) until 2024.
So why buy?
The evidence is undeniable that CHPT could get caught in an updraft in the increase (and really, infancy) of the EV market. Ford Motor Co. NYSE: F recently just invested millions into EV development in Kentucky and Tennessee. General Motors Company NYSE: GM believes it will double revenues through EVs.
Volta Inc., founded in San Francisco, develops and installs charging stations for electric vehicles. The Volta network installs and manages level 2 charging stations completely free of charge for the first 30 minutes.
The company has seen recent successes in a few key areas:
- Six Flags Agreement: Volta has partnered with Six Flags Entertainment Corporation to make EV charging accessible at Six Flags parks.
- PredictEV™ product: Volta has created a machine learning and artificial intelligence (AI)-driven solution for infrastructure planning with Southern Company to utilize the product in its transportation electrification programs.
- Bloomberg Media: Bloomberg Media and Volta partnered with the Air Pollution Scoreboard to create digital content.
Revenue grew 77% year-over-year to $8.5 million, compared to $4.8 million in the prior-year period due to increased sales of media campaigns with national brands. Network development revenue decreased year-over-year due to a decrease in customer-owned installations. Volta entered into a definitive business combination agreement with Tortoise Acquisition Corp. II.
Wallbox Chargers S.L., headquartered in Barcelona, provides electric vehicle charging and energy management solutions. Wallbox employs over 700 people across nine offices in Europe, Asia and the Americas and two manufacturing plants. The company offers a portfolio of hardware and software solutions, including Quasar for bi-directional DC home charging and the Supernova, for cost-effective public charging. Wallbox expanded into the U.S. in 2021 and became the No. 1 best-selling EV charger on Amazon within the first three months of the launch.
The Q3 revenue in 2021 was $22 million, up nearly 250% year-over-year and revenue was $55 million, up over 280% against the same period and up 16% from the 2021 budget forecast.
In Germany, Europe’s largest EV market, YTD revenues in 2021 were nearly 540% greater than full-year 2020 results, nearly $8 million in revenues through September 30. In the United Kingdom and France, the company outperformed full year 2020 revenues by 63% and 50%, respectively.
Time to Buy EV Charging Stocks, EV Stocks?
Will the internal combustion engine go the way of the cotton gin? Well, actually, the cotton gin is still used today, so maybe regular cars will just be phased out?
The automotive sector faces a unique combination of social and political upheaval that pushes toward electric vehicles. However, it's not just about the actual cars, even though Tesla grabs headlines every day. They still need to be charged.
The infrastructure build-out and network aims will cause booms in manufacturing and more, causing upward swings for companies involved in EV charging. Stay tuned, get prepared and get your portfolio ready for the surge.
Before you consider ChargePoint, you'll want to hear this.
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