EVgo Stock Looks Ready to Take a Charge

By Larry Ramer

In the run-up to its very impressive first-quarter results released on May 6, EVgo (EVGO) stock had an almost 9% climb from my bullish April 17 write-up. The report saw the EVGO share price pop, then pullback to end the week. But all signs point to more gains ahead.

The electric vehicle charging company’s medium-term and long-term outlooks appear to be very strong, while the firm is well-positioned to build many more charging points in the coming years. 

Also importantly, tariffs are unlikely to be a significant, negative catalyst for the firm.

At Friday’s $3.66 a share close, EVGO stock is more than 75% below the consensus $6.45 a share FactSet consensus, with a buy rating.

Impressive Q1 Results

EVgo’s sales advanced 36% versus the same period a year earlier to a record $75 million, while the revenues generated by its charging network soared 49% year-over-year to $47.1 million. 

Also noteworthy is that the volume of electricity purchased on average from each of the firm’s public stalls jumped 36% YOY, showing that the demand for electricity at each of the stalls is generally rising significantly. 

Finally, the amount of electricity generated by all of its chargers climbed a huge 60% YOY, and, after its revenue had stagnated at $66 million to $67 million for three consecutive quarters, its sales in Q1 climbed 11% in Q1, compared with Q4 of 2024. 

Excellent Medium-Term and Long-Term Outlooks

EVGO stock should perform well in the medium term because the company expects its EBITDA, excluding certain items, to break even this year. Further, it predicts that it will break even from a levered free cash flow perspective in 2026.  

If it does achieve these milestones, the shares are likely to advance as the company approaches profitability. 

Also in the medium term, EVGO will probably benefit from the rapid growth in the sales of EVs made by companies other than Tesla (TSLA). Unlike Tesla, most of these automakers do not have extensive charging networks.

Further, EVGO management credibly asserted during its earnings conference call that the number of new chargers installed on U.S. roads is likely to shrink in the coming quarters as tariffs make building them more expensive.

Further,  fewer entities will likely install chargers as economic growth slows and obtaining financing becomes more difficult. Reduced competition should be positive for the firm’s financial results in the medium term.

And over the long term, EVgo will probably get a big boost from a tremendous acceleration of EV sales growth in the U.S.  

Indeed, even after President Donald Trump  — generally an EV opponent  — won the 2024 presidential election, S&P has predicted that U.S. EV sales will soar to  5 million in 2030, up significantly from 1.3 million in 2024.

And as you’ll see in the next section, EVGO will be well-positioned to exploit this surge, given its likely ability to launch many more EV chargers in the longer term.

Set to Build Many More Chargers, With Little Likely Tariff Effect

 On April 4, EVGO received $19 million from the U.S. Department of Energy, representing the second installment of its $1.25 billion loan guarantee from the agency. The firm intends to use the funds “to build approximately 7,500 fast charging stalls across the U.S. over the next five years.” 

The fact that the firm received the second advance implies that the Trump administration does not plan to block any of the funds from being disbursed.      

On the tariff front, CEO Badar Khan  siad that the company would only have to pay $4 million to $5 million in tariffs this year. The latter sum will be more than offset by the firm’s “$10,000,000 in CapEx efficiencies this year,” and the tariffs will not impact its adjusted EBITDA at all. 

Disclaimer: At the time of writing, the author held a long position in EVGO stock. The information provided in this article is for educational and informational purposes only and should not be construed as investment advice. Always conduct your own research or consult with a licensed financial professional before making any investment decisions. Past performance is not indicative of future results.

Larry Ramer is currently ranked 630 out of 31,088 financial bloggers analyzed by TipRanks, with a 10% return on his buy and sell ratings. He has been a long-time contributor to Insider Monkey, Seeking Alpha and InvestorPlace. He is one of the founding contributors to this newsletter.

He focuses on contrary investing and specializes in the renewable energy and consumer discretionary sectors. Among his highly successful, contrarian picks have been Plug Power, Exxon Mobil, solar stocks, and airline stocks. On the downside, he was an early predictor of the collapse of cryptocurrencies, marijuana stocks, Ocugen, and Meta Platforms.