Trust the stock markets to react the way you least expect. How else can investors in Blink Charging (NASDAQ:BLNK) explain the sharp drop in the electric vehicle (EV) charging stock the day the company appoints an executive to help expand its business? Blink Charging shares were down 8.6% as of 1:45 p.m. EST Tuesday but had dropped nearly 11.7% earlier in the day.
It appears traders bought the hype last week and are now selling the news.
Blink Charging was among the top performers in the EV space last week, after Congress passed President Biden's $1.2 trillion infrastructure bill. Among other things, the bill seeks to spend $7.5 billion on building an EV charging network of 500,000 chargers in the United States. Blink Charging was also quick to release a statement applauding the infrastructure bill.
In the following days, Blink Charging even received multiple analyst upgrades, including from:
- Cowen (NASDAQ:COWN): Raised its price target to $41 a share.
- Roth Capital: Raised its target to $45 per share.
- C. Wainwright: Upped its price target to $50 per share.
- DA Davidson: Raised price target to $35 a share.
One common theme fueling analyst upgrades is the growth prospects for EV charging companies under the Biden administration.
To its credit, Blink Charging also delivered better-than-expected numbers for its third quarter last week, generating record revenue worth $6.4 million. Blink Charging's revenue soared 607% year over year as the number of charging stations it installed or contracted during the quarter jumped 351% year over year to 3,016.
Tuesday morning, Blink Charging announced the appointment of Amy Dobrikova as vice president of fleet solutions to help drive the company's plans to expand its product line and services for public and private fleets. Before joining Blink Charging, Dobrikova served as the vice president of channel sales at aftermarket auto company Cardone Industries and has held various positions across multiple auto and industrials companies through her career.
So why did Blink Charging shares tank on Nov. 16? It appeared to be nothing but a case of profit-taking, especially after the stock's torrid run-up in the past month.
Growth stocks like Blink Charging can be volatile, and a sell-off isn't surprising if a stock has run up a lot. Just yesterday, Blink Charging shares had popped by double digits. I'd expect the volatility to continue, especially as more investors join the race to bet their money on electric stocks to play the upcoming EV industry boom.