EVgo stock price has held steady in the past few days as investors cheered its ongoing growth trajectory. Most of this growth happened after it reported strong earnings earlier this month. It was trading at $3.85, up by 75% from its lowest level this year. This article explains whether the EVGO share price has more upside.
EVgo business is thriving
EVgo has emerged as one of the fastest-growing companies in the electric vehicle charging industry, a sector that is expected to keep growing.
The sector is expected to boom as the number of electric vehicles (EV) in US roads jump. Data shows that there are now over 6.8 million plug-in electric vehicles, a number that is expected to keep growing.
Recent data shows that US EV sales rose by 14% in Q1, with non-Tesla growth being over 36%.
Its annual results shows that the annual revenue has grown from $14.6 million in 2020 to $256 million last year.
The most recent results showed that the company’s revenue rose to $75.28 million in the first quarter, up by 36% from the previous quarter’s $55.1 million. Its gross profit also rose by 36% to $9.3 million.
Most importantly, the company has started to narrow its losses. Its net loss improved by 7% to $26 million.
Wall Street analysts believe that EVgo’s business has more room to grow as the EV sector continues expanding. The average estimate for the current quarter revenue is $85.36 million, representing a 28% annual increase. The most optimisic analyst expects its revenue to grow to $93 million.
Read more: 3 reasons why the EVgo stock price may surge 160% soon
Analysts expect that EVgo’s annual revenue will rise by 37% to $353.5 million, followed by $468 million next year. This means that it will likely cross the important milestone of $500 million or earlier.
EVgo’s profitability will be impacted on the tariffs Trump has placed on imports. The management expects that the impact of tariffs will be between $4 million and $5 million this year.
The other notable aspect is that the company has received a $1.25 billion deal from the Department of Energy (DoE). As per the terms, the company will draw about $75 million of these funds a month, funds that will be used to expand its charging infrastructure.
EVGo’s top benefit is that it is growing its market share as other companies like ChargePoint and Blink Charging struggle.
Analysts are largely optimistic about the EVgo stock price. The average forecast for the stock is $6.15, up sharply from the current $3.84. The most optimistic analysts are from companies like Evercore, JPMorgan, Stifel, and Cantor Fitzgerald.
Read more: EVgo stock price analysis: risk/reward is very attractive
EVgo stock price analysis
The daily chart shows that the EVGO share price bottomed at $1.85 in 2024 and then bounced back to $9.04 late last year. It has formed a double-bottom-like pattern whose neckline is at $9.05.
A double bottom is one of the most bullish patterns. Also, the Relative Strength Index (RSI) and the MACD indicators have pointed upwards. The two lines of the MACD are about to cross the zero line, while the RSI has jumped above 50.
Therefore, the most likely scenario is where the stock rises and retests the psychological point at $5. A drop below the support at $1.85 will invalidate the bullish outlook.
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