ChargePoint (NYSE:CHPT) stock took a bit hit in March and April but has bounced back nicely in May and June. It’s now pushing its way towards all-time highs.
The catalyst? There are a few of them —
- Recharged growth trade on lower bond yields
- Reinvigorated optimism about EVs and the charging network buildout
- New, rather impressive products from ChargePoint
This will all last. EVs will take over the world, charging stations will replace gas pumps and ChargePoint will be the biggest charging company in the world when all is said and done.
ChargePoint is North America’s largest operator of electric vehicle charging stations. It should be able to leverage their early entry into the market as well as its size. Thanks to network effects, it could turn into the EV version of Shell (NYSE:RDS-A, NYSE:RDS-B) or Exxon (NYSE:XOM) by 2030.
On the surface, this company looks like all other EV charging companies.
ChargePoint operate on the standard hardware-plus-software model — selling both physical EV charging ports and end-to-end software platforms to manage them. Its assortment of chargers includes L2 chargers and a smattering of DC fast chargers. And it costs money, around $2 to $5, to use these chargers.
Basically, ChargePoint is doing what everyone else is doing, but there’s so much more to it than that …
CHPT Stock: Network Effects Set ChargePoint Apart
Where ChargePoint shines is in its unparalleled size and dominance in the EV charging station market.
It’s seven times larger than its nearest competitor, with over 100,000 charging ports and 73% of L2 EV charging stations.
Its size is especially significant because of network effects.
Of ChargePoint’s commercial clients, more than 60% of Fortune 500 companies employ ChargePoint charging stations at their corporate offices. If companies such as Facebook (NASDAQ:FB), Netflix (NASDAQ:NFLX), Salesforce (NYSE:CRM), Microsoft (NASDAQ:MSFT) and Adobe (NASDAQ:ADBE) already utilize ChargePoint chargers — which shows other companies who to turn to when they want to install their own EV charging stations — ChargePoint should be able to leverage this array of existing customers to win more and more big-name contracts.
ChargePoint is on its way to dominating the commercial workplace vertical of the EV market for the near- to long-term future.
From a consumer-facing perspective, ChargePoint is also setting itself up for future success.
The company has teamed up with auto makers like Mercedes-owner Daimler AG (OTCMKTS:DMLRY) and BMW (OTC:BMWYY) to integrate the locations of its charging stations into in-car navigation systems.
ChargePoint also offers a popular app that enables drivers to locate its charging stations, see if they’re currently in-use or not and check prices. The app keeps ChargePoint on consumers’ minds, which will help the company dominate the at-home, residential EV-charging market.
Again, it all comes down to ChargePoint’s unmatched network effects.
Which is why I believe that, as EVs gradually replace gas cars, ChargePoint has the potential to replace Shell as the leading operator of “refueling” stations.
Naturally, that would mean huge upside potential for CHPT stock.
Which is why CHPT is one of my top picks in EV charging. And long-term, you can bet that CHPT stock will score investors massive returns.
To that point, there’s more companies in the EV space of which I’m uber bullish on. In fact, I have a total of eight Next-Gen Mobility stocks that could score investors early-Tesla-like returns over the next months and years.
These stocks include the world’s most exciting autonomous vehicle startup and a company that we fully believe is a “Tesla-killer,” among many more.
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On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.
By uncovering early investments in hypergrowth industries, Luke Lango puts you on the ground-floor of world-changing megatrends. It’s the theme of his premiere technology-focused service, Innovation Investor. To see Luke’s entire lineup of innovative cutting-edge stocks, become a subscriber of Innovation Investor today.