What happened
The stocks of many companies in the electric vehicle (EV) sector have had a rough time in 2021. Charging network company ChargePoint Holdings (CHPT +1.62%) has been no exception. Since the start of the year ChargePoint shares have dropped 40%. But shares are bouncing today. As of 11:45 a.m. EDT Friday, shares of the company were trading up by about 9.5%.
So what
There's no specific news out of the company today. But ChargePoint was one of the seemingly few EV companies that went public through a special purpose acquisition company (SPAC) merger that already had an operating business and growing revenue. Investors looking to gain exposure to the sector may have decided that the 2021 drop in the stock price has brought the valuation to a point worth owning.
Image source: ChargePoint Holdings.
Now what
For more than 10 years, ChargePoint has provided charging solutions in North America and Europe for commercial uses, fleet owners and operators, and residential single and multi-family homes. It has leading market share in North America for Level 2 charging, which uses 240 volt power. It also has more than 2,000 fast charging stations available for public use.
One knock on some public companies coming off SPAC mergers has been the reality that prior predictions for growth aren't going to materialize. But ChargePoint exceeded its prediction for calendar year 2020 revenue, reporting $146 million for the fiscal year ended Jan. 31, 2021. Its guidance for the current fiscal year was also reaffirmed with the company expecting about $200 million at the midpoint of its estimate range.
After the drop in price with general euphoria in the EV sector, investors today may be signaling interest in having ChargePoint as part of the EV section of a portfolio.
