ChargePoint Holdings (CHPT) is an established U.S. electric vehicle charging leader with a recognizable brand and strong customer relationships. Founded in 2007, the company started publicly trading on the New York Stock Exchange following the completion of its previously announced business combination with Switchback Energy Acquisition Corporation.
Special purpose acquisition companies (SPACs) were big news in 2020 and continue to be so in 2021. SPACs are shell companies organized by sponsors with operating and investing experience that raise capital by conducting an IPO and listing on a stock exchange.
With more SPACs raising capital and looking for deals, high-quality target companies like ChargePoint Holdings (CHPT) have found an opportunity to raise capital while benefiting from the increasingly top-tier talent of SPAC sponsors. With that said, investors are adding charging network companies to their portfolios as public and private investment combinations grow in the sector.
In June 2017, ChargePoint purchased nearly 10,000 electric vehicle charging stations from General Electric (GE). Up until then, the company managed nearly 35,000 charging stations across Mexico, Australia, Canada, and the United States.
ChargePoint reached 100,000 chargers in September 2019 and has added more than 2,000 charging locations per month since then. The company says it has more than 70% of the North American Level 2 charging network with drivers plugging into the network approximately every two seconds.
By 2025, projections indicate there will be seven million electric vehicles on the road, and that five out of every nine new cars that hit the market will be electric. This means that more than half of all new vehicle sales in the United States will be electric within the next four years.
Moreover, under President Biden’s new infrastructure program, the White House reiterated its plan to build more than 500,000 electric vehicle (EV) chargers over the next decade. ChargePoint has integrated its service with Apple CarPlay, bringing EV charging data inside the vehicle and allowing drivers to access charging information directly from their infotainment system.
Under this partnership, drivers can find nearby chargers, check station status, start a session, navigate to a station and more, without the need to use a smartphone while driving. ChargePoint’s integration with CarPlay is another pivotal partnership in the evolution already underway, driven by software and increased connectivity.
The company has also formed a partnership with the National Association of Truck Stop Owners (NATSO) to greatly expand EV charging options across the United States. Over the next decade, ChargePoint and NATSO believe they can develop over 4,000 charging stations at travel plazas and fuel stops by leveraging $1 billion in the capital.
While the potential sounds good, it is important to note that as a company, ChargePoint is not yet profitable and does not expect profitability until 2024. With that said, it is more important to look at the technical aspect over the near-term than fundamentals.
The current chart shows major support at the $20 area that was tested twice in March with the recent April highs hitting $32.48 and $32.47 in back-to-back sessions. This can be considered a “double-top” with a close above $32.50 and the 50-day moving average likely leading towards another leg higher in the stock. Current and key support is at $27.50 with “gap down” potential towards $25-$22.50 and the 200-day moving average on a close below this level.