What happened

Shares of EVgo (EVGO -3.39%) gained 14.4% in October, according to data from S&P Global Market Intelligence. The electric vehicle (EV) charging stock posted gains in conjunction with momentum for the broader EV space and also got a big boost from some business-specific news.

EVGO Chart

EVGO data by YCharts.

EV leader Tesla reported its third-quarter results on Oct. 20, delivering blockbuster earnings and an encouraging growth outlook despite headwinds related to semiconductor shortages and general supply chain constraints. The automaker's better-than-expected Q3 performance bodes well for the EV space overall and appears to have driven valuations for other companies in the broader category higher. In addition to bullish industry sentiment, EVgo also announced new partnership news that created positive momentum for its share price. 

A person next to an electric car being charged.

Image source: Getty Images.

So what

EVgo published a press release on Oct. 29 announcing that it was expanding its partnership with the city of Los Angeles. The company said that it would be accelerating the construction of new EV charging sites as part of its partnership with the Los Angeles Department of Water and Power (LADWP). EVgo already has the largest network of public fast-charging stations in the city, and its expanding collaboration with the LADWP suggests continued public support that bodes well for the company's growth trajectory. 

Now what

EVgo stock has continued to gain ground early in November. The company's share price is up roughly 10.5% in the month so far.  

EVGO Chart

EVGO data by YCharts.

EVgo now has a market capitalization of roughly $2.7 billion. The stock skyrocketed early in 2021, but it pulled back substantially as investors became more cautious about highly growth-dependent companies and adopted more measured views on its near-term outlook. The stock hit a record high of $24.34 in January, and it's now down roughly 58% from that level.

EVgo is set to announce its third-quarter results before the market opens on Nov. 10. When the company last reported quarterly results, it reiterated its guidance for revenue of $20 million in the current fiscal year. As that target implies, this is still a relatively young business with a growth-dependent valuation. There's a promising runway for expansion here, and the overall EV market looks primed for more growth over the long term, but investors should approach the stock knowing that strong business momentum is baked into the current share price.