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ChargePoint: Only Pain Ahead

Mar. 03, 2023 4:06 AM ETChargePoint Holdings, Inc. (CHPT)54 Comments


  • ChargePoint reported a big miss for FQ4 numbers.
  • The charging station company guided FQ1'23 sales $31 million below analyst estimates.
  • CHPT stock trades at 40x subscription revenues with the market applying valuations to charging station revenues sold virtually at cost.
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Chargepoint DC Fast Chargers powered by Texas Wind Energy on Electric drive in Austin Texas


After the close, ChargePoint Holdings (NYSE:CHPT) appears to have reset the expectations for charging station growth in the year ahead. The company continues to face supply and shipment challenges and the financials never seem to improve with surging

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Comments (54)

Flipp profile picture
The entire EV charging system
Segment is drastically underfunded, all these companies need at least 4x more cash reserves than what they currently have. The promised growth is all dependent on the EV manufacturers growth and launch schedules, typical chicken and egg situation. These companies need to get tens of thousands of chargers installed and then basically wait for the consumer to buy EV’s which will be very slow due to high prices and lack of EV Education. Overall this segment will go through a massive consolidation within the next 2 years as companies run out of cash, my guess is that major oil companies and utilities companies will buy these companies up at very low prices and then wait for growth
Stone Fox Capital profile picture
Great summary, one doesn't want to invest in companies playing the chicken and egg game with no benefits. It works for $TSLA building SuperChargers b/c it helps them sell more EVs, but $CHPT is wasting millions and billions with no guaranteed return. They just help more EVs be sold.

Always look to invest in a business that has customers lining up when a new store or charging station is opened, not one where they hope customers show up in a few years.
Electric outlets: Barriers to entry, none. Moat, none.
Stone Fox Capital profile picture
Investing 101... keep it simple. This was my exact first thought about charging stations and my thesis didn't change one bit once researching the stocks.
@thehip pretty much sums it up!
VANGUARD GROUP INC increased "ownership" stake 27% last month.


Rob G. in Vegas profile picture
@Natturner1966 That's all passive management. Vanguard does very little active management. They are likely just buying more based on fund inflows.
Rob G. in Vegas profile picture
This company was recommended as a long idea several times over the last year by Downtown Josh Brown on CNBC. I like his economic commentary, but would recommend viewers to try and steer clear of his stock picks.
Stone Fox Capital profile picture
@Rob G. in Vegas
Agree, he is consistently invested in richly valued stocks playing the momentum game.
@Rob G. in Vegas Brown is a good talker but really bad at reco stocks; too bad, i also have chpt
This is a company that will need to invest a lot over the years to grow a network. With the cost of capital increasing significantly without the business catching up, the writing was on the wall on this one. The next shoe to drop (or reprice ) imho is Tesla.
Stone Fox Capital profile picture
$TSLA is about to become a competitor with their SuperChargers opening up to all autos. Tesla is a far better buy here with an actual business plan.
@Stone Fox Capital agree, in general I think $TSLA is a better buy, but at a very different price.
I think your making a gross miscalculation. What is fueling your anti electrification bias? What is your plan for reducing the world’s use of fossil fuels?
Stone Fox Capital profile picture
How does hooking up to a coal or natural gas plant help much? Besides, being anti EV charging station business models isn't the same as being anti EVs. Why do you want to fund losses?
@Stone Fox Capital I think your focused to much on charging stations. They are here to stay and will be the primary way we charge our EV’s. The trajectory for that is immutable. Many governments around the world are mandating electrification. Entire car companies will stop making ICE’s. The real issue is where will the power for the grid come from. I can certainly understand the argument around using even more fossil fuels to generate electricity for EV’s. My answer to that is it’s a transitory situation until we can find better, sustainable sources of energy.
Stone Fox Capital profile picture
How about the world come up with the sustainable sources of energy than transition to EVs? Kinda getting the cart in front of the horse.

Are charging stations here for good? Won't we get to 1,000+ mile battery charges or solar panels on cars that are self charging so that public chargers become dinosaurs.
Sobering commentary. Another industry making a joke out of investing in ESG
Stone Fox Capital profile picture
It's like identity politics.... you aren't picking the best candidate or business model, you are just picking a politician and business that fits into a bucket.
SkylineView profile picture
When an author uses adjectives like ‘horrible’ in their conclusion, you can bet they are prone to hyperbole and bias.

Listened to the call last night; story and revenue growth not only in tact, but improving. I’m a buyer here this morning if drop holds.
Stone Fox Capital profile picture
Don't you realize $CHPT needs something beside revenue growth?
SkylineView profile picture
@Stone Fox Capital yes, like reoccurring subscription revenue. You conveniently used the $100 million realized number, and not the $200 million that is already locked in by contract.

Ultimately, it’s ports in the ground that matter. The company that wins that category takes all. They are still the leader and I see no change to the story.
Stone Fox Capital profile picture
Why do they take all? Why can't a well capitalized company come along in 2025 with better software and a cheaper subscription model?
Not sure it is such a big miss. They said supply chain slowed them down some and without that they would have made their goals. 1st Qtr revenue is 56% higher than last year 1st Qtr. Their first quarter is their slowest quarter. Their 2-4 Qtrs are going to be much higher.(their words) but margins will only improve 1-2% because of product mix.
Stone Fox Capital profile picture
The lack of margin improvement says it all. $CHPT has no cushion for supply chain issues when burning $50+ million per quarter.
Shookmeister profile picture
@j-gphillips While once a legitimate issue for companies, the term "global supply chain" is now a corporate catch phrase all for all things negative.
ndardick profile picture
Yup. Similar story for EVGO, or will it have a happier ending?
Stone Fox Capital profile picture
Don't see any of these companies having a happy ending until the business model changes. All of these charging station companies are wildly spending hoping customers arrive. Imagine a retailer putting up a store in a location where very few people live hoping the population will double and triple in the next 5 years in order to support the store. No, they wait for the population to arrive first versus bleeding cash for years.
@stone Fox Capital Retail companies will move into an area early to cherry pick the best spots for cheaper prices. If you wait until the area has developed you will end up with what is left over at much much higher prices. Why you see Walmarts, McDonalds, ....etc building in areas of future growth
Stone Fox Capital profile picture
False by a mile, they never open in an area without the population to cover the store.
sancerrefrankie profile picture
nice work @Stone Fox Capital your research like the lyrical music ode aint nudin to f wit ! 💪 www.youtube.com/...
A bit dramatic...makes sense given your sale rating...do you believe EVs are the future? If yes, do you think charging station companies are in the 1st or 9th inning?!?
@garydstuart Exactly...CHPT wants to keep ramping up market share, that's the name of the game, the Big payoff then comes, maybe he's never followed other Big companies in their beginnings like a TSLA , AMZN ect ect... CHPT is running with the ball way out in front in EV Charging which is basically in its infancy...all just my opinion only
@TheeSoluution totally agree...this is not a trade for me...it's a 3-5 year hold.
Stone Fox Capital profile picture
@garydstuart @TheeSoluution
EVs are likely the future, but not 100% convinced they should be the future. The world is investing far too much for very little climate benefits.

Charging station demand is in the 1st inning, but will these charging station companies make it to the 9th inning? Reminds me of the Canadian cannabis companies.
Michael Rogus profile picture
It's not that bad - it's just the stock is 40% overpriced with these numbers.
Stone Fox Capital profile picture
@Michael Rogus
How do you assign any value to $CHPT?
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