As EV Takes Off, Can CHPT Turn the Corner?

[View in browser]( [The Spill Logo] BROUGHT TO YOU BY: [Logo]( Proprietary Data Insights Financial Pros’ Top Green Energy Support Stock Searches in the Last Month Rank Name Searches #1 'Chargepoint Hldgs Inc 207 #2 'Plug Power Inc 84 #3 'First Solar Inc 49 #4 'Fuelcell Energy Inc 15 #5 'Ballard Power Sys 1 #ad [Become a better investor in just 5 minutes a day]( Brought to you by [Masterworks]( [$17.7 Billion Year Highlights Safe Haven Asset]( [Masterworks - $17.7 Billion Year Highlights Safe Haven Asset]( For 2023, investors have one New Year's resolution: Stop. Losing. Money. From “transitory” inflation, to millennial Bernie Madoff, 2022 was a wild ride in the markets. That is, except for one market. The blue-chip art market. In fact, art auctions hauled in nearly $18 billion in 2022. The best year ever in a 277-year old market – all while financial markets tanked. Now you’re probably wondering: “That's great, but how can someone like me get in on the action?” The answer is easily, with Masterworks. Masterworks securitizes artworks by qualifying offerings with the SEC, allowing YOU to invest in shares of multi-million dollar paintings by names like Banksy. Masterworks has also built a solid track record with all 11 of their exits netting a profit, the last 3 realizing +13.9%, +35.0%, and +10.4% net returns each. Spill readers can skip the waitlist to join here. [Skip the waitlist]( *See important Regulation A disclosures at [masterworks.com/cd](. Searches for ChargePoint Surge In 2019, 1.2 million electric vehicles dotted U.S. highways. By 2030, that number is expected to climb to somewhere in the range of 18.7 - 30 million. Major malls, office parks, and retail shops now offer electric vehicle charging stations. Chargepoint (CHPT) operates one of the largest charging networks in the world, with 118,000 spots across 14 countries with access to over 133,000 public places to charge through network integration in North America and Europe. Despite the company’s immense reach, it neither generates positive cash flow or a profit. Our latest TrackStar data suggests a surge in search volume by financial pros looking at Chargepoint’s stock. So, what exactly do they see that we don’t? ChargePoint’s Business ChargePoint emerged on today’s stock exchanges through a special purpose acquisition company (SPAC). The company’s network of charging stations work with most major brands like Tesla, though they may require an adapter. However, most of its network is A/C outlets, which don’t charge nearly as quickly as D/C. [Activated ports] [Source: ChargePoint Investor Presentation]( ChargePoint offers a suite of cloud-based software and hardware solutions for commercial and fleet owners. [Products] [Source: ChargePoint Investor Presentation]( The company breaks its revenue into two: Networked Charging Systems and Subscriptions. The former encompasses the sale of charging hardware. The latter takes recurring revenue software subscriptions. Here’s what the unit economics look like for a typical charging station. [Revenue] [Source: ChargePoint Investor Presentation]( Financials [Financials] Source: Stock Analysis ChargePoint’s been able to grow revenues at a blistering pace. And as far as gross margins are concerned, it turns a profit. However, the R&D and SG&A costs just obliterate any chance at profitability. [Income statement] [Source: ChargePoint Investor Presentation]( To be fair, both have come down substantially as a percentage of revenues. And given the pace of improvement, ChargePoint could turn a profit on paper. However, there appears to be no timeline to become cash flow positive. And at the current rate, ChargePoint will need to raise more capital before the end of next year. Valuation [Valuation] Source: Seeking Alpha Given the popularity of the ‘green energy’ stocks over the last few years, we wanted to see how they fared compared to CHPT. It turns out that only First Solar (FSLR) was able to report a profit and positive cash flow. The rest…not so much. But hey, at least CHPT has the cheapest price-to-sales ratio. Growth [Growth] Source: Seeking Alpha If you’re not going to turn a profit, then you’d better deliver growth. At least CHPT shines there, as does Plug Power (PLUG) and FuelCell Tech (FCEL). Ballard Power Systems (BLDP) may just be a lost cause. Profitability [Profit] Source: Seeking Alpha Another point in CHPT’s favor is their positive gross margins, something only FSLR can claim. But that’s about it. [Are Alternative Investments a gray area? The Alt can add some color.]( The most profitable investors stay informed and up to date. Stay on top of Alternative Investment trends with credible articles and videos directly to your inbox with our hand-curated newsletter The Alt. [Subscribe now.]( Our Opinion 2/10 Why did we even give this stock a 2/10? First, it’s better than most of its peers, which isn’t saying much, but still. Second, it could find a way to profitability in the next year or so. But for anyone not trading the stock, it’s best to steer clear. 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