It's been a wild week for stocks in every portion of the electric vehicle sector. A snapshot of that can be seen in charging network company ChargePoint (CHPT -3.11%), solid-state battery maker QuantumScape (QS -1.73%), and vehicle designer Fisker (FSR -3.10%). At the intraday lows of the week, ChargePoint and QuantumScape stocks were down nearly 30% from last Friday's closing price. But stocks in the sector are now rebounding on the final day of this week's trading.
As the market trades early Friday, ChargePoint and QuantumScape are lower by 13% and 17%, respectively, for the week, while Fisker is near breakeven, according to data provided by S&P Global Market Intelligence.
Investors have been repricing equities, as interest rates are on the rise, and companies like these three with no net earnings are being hit the hardest. ChargePoint, in fact, is the only one of the three that even has revenue at this point. But as the week progressed, some investors felt the lowered valuations made for good entry points to these stocks.
Each of these companies is making progress growing its businesses. ChargePoint beat its own guidance for revenue in its fiscal 2022 (ended Jan. 31), with 65% year-over-year growth. And the company told investors to expect sales to increase another 96% at the midpoint of its fiscal 2023 guidance. Recently, the company raised $300 million through the sale of convertible notes. The money will be used to continue to support growth initiatives. ChargePoint reports its next financial and operations update on May 31.
QuantumScape and Fisker both say they continue to be on track to commercialize their respective products. Investors know there is no guarantee of success, however. That's especially true in the case of QuantumScape's solid-state battery technology, which has yet to be proven commercially viable.
Fisker plans to begin production of its first vehicle in November, and it announced plans for a low-priced EV, named PEAR, this week. The PEAR, designed for city driving, will start at a base price below $30,000.
But this week was all about valuation, rather than operations. The share-price drop has brought market capitalization down to under $3.5 billion for ChargePoint and Fisker. QuantumScape is still valued at more than $5 billion, reflecting the massive potential should it successfully reach commercialization.
Investors who buy at any price should still enter these stocks with long-term outlooks and with money that is in the speculative portion of their portfolio.