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For the current quarter, ChargePoint expects sales of between $148 million and $158 million.
Bing Guan/Bloomberg
Electric-vehicle charging company
ChargePoint
reported better-than-expected sales and earnings Thursday evening. The stock was falling, however, in early trading Friday because history is repeating.
The company reported a fiscal first-quarter per-share loss of 15 cents from $130 million in sales. Wall Street was looking for a 19 cents loss from $128 million in sales.
Shares were down 3.9% in premarket trading Friday, after being down 6% in after-hours trading Thursday.
S&P 500
and
Nasdaq Composite
futures were up 0.5% and 0.6%, respectively.
Sales guidance for the coming quarter is the likely reason for the fall. For the current quarter, ChargePoint expects sales of between $148 million and $158 million. The $153 million midpoint is below Wall Street’s projection of $166 million.
Guidance is for the fiscal year 2024 second quarter. ChargePoint’s fiscal year ends in January.
At $153 million, sales would be up about 46% year over year. Sales grew almost 60% year over year in the quarter just reported. That’s pretty good growth. Still, the mix of Street expectations, investor expectations, and guidance has the stock down.
A similar dynamic unfolded when ChargePoint reported year-end numbers on March 2. The company guided to about $127 million in Q1 sales. Wall Street was projecting $140 million in sales at the time. ChargePoint stock opened on March 3 down almost 12%.
Things turned around on March 3. Shares ended up closing down less than 2% at $11.08. Investors will have to see how Friday trading develops.
Evercore ISI analyst James West is fine with the quarter, pointing out in a Friday report the company’s gross profit margins are improving. Adjusted gross profit margins came in at 25% in Q1 compared with 23% in Q4. “ChargePoint also recently surpassed for the first time an annualized subscription revenue benchmark of $100 million,” wrote the analyst. “The long tail of consistent software sales should garner a superior [valuation] multiple as well.”
He rates shares Buy and has a $20 price target for the stock. Overall, about 77% of analysts covering the stock rate shares Buy. The average Buy-rating ratio for stocks in the S&P 500 is about 53%. The average analyst price target is about $16 a share.
Coming into Friday trading, ChargePoint stock is down about 30% over the past 12 months. The S&P 500 is up about 1% over the same span. Rising interest rates and a slowing economy have sapped some investor enthusiasm for companies that don’t produce consistent profits.
Wall Street projects full-year profitability for ChargePoint by calendar year 2025.
Write to Al Root at [email protected]
Source: https://www.barrons.com/articles/chargepoint-earnings-beat-stock-falling-ev-electric-vehicles-9ba38133?siteid=yhoof2&yptr=yahoo