Car charging infrastructure provider Blink Charging’s [BLNK] share price fortunes are inextricably linked to EV sales, which are continuing to gain ground.
There were 159,000 EVs sold in the US during the second quarter, bringing the total to 310,000 for the first six months of the year, according to data from EV nonprofit group Veloz.
By comparison, there were 322,000 sales in the entirety of 2020. Driving up sales has been traditional automobile manufacturers expanding their mass-market EV line up, such as Volkswagen’s ID4.
Number of EVs sold in the US during Q2
That demand has sent Blink Charging’s stock up over 17% since hitting a year low on 13 May. And with the stock still down 30% from an all-time high of $64.50 hit on 26 January, there still could be more upside left.
As second-quarter earnings come into view Blink Charging’s share price has several growth drivers. The company will report earnings on Wednesday.
Growth drivers for Blink Charging’s share price
Biden sets EV sales targets
Last week was monumental for the US’s EV ambitions. On Monday, the Biden administration and bi-partisan lawmakers passed the federal infrastructure package. This included $7.5bn earmarked to improve EV infrastructure.
Then on Thursday President Joe Biden gave an executive order to make half of all new vehicles sold in the US EVs by 2030. Biden also invited Detroit’s three big auto manufacturers - Ford [F], General Motors [GM] and Stellantis [STLA], which owns Chrysler - over to the White House to promote EV sales. Biden’s announcement saw Blink Charging’s stock surge 7.4% during Thursday’s morning session, although by Friday’s close the stock was slightly down on the week.
Amount allocated for EVs in Biden's infrastructure bill
Growing charging network
Around 80% of EV charging is still done at home, according to The Motley Fool’s Rekha Khandelwal. Part of that is due to people not wanting to run out of juice halfway through a journey with nowhere to charge. That’s good for Blink as there’s still a clear opportunity to develop its network of charging stations. However, along with the challenge of rival ChargePoint Holdings, Blink Charging also has to contend with EV manufacturers such as Tesla and Volkswagen which have both developed their own network of charging points.
Still, in the first quarter, Blink reported that the number of charging stations contracted or deployed grew by over 370% year-on-year. How Blink Charging is managing to grow its network will be the must-watch metric in the second quarter.
When is Blink Charging reporting Q2 earnings?
What is Wall Street expecting?
Wall Street expects Blink Charging to post a $0.16 loss per share, an increase on the $0.11 loss per share seen in the same period last year. Revenue is forecast at $2.44m, a 55.4% jump on last year’s $1.57m. For the full year, losses are expected to come in at $0.7 a share on $12.41m in revenue.
In the first quarter, total revenue increased 72% to $2.2m compared to $1.3m in the first quarter of 2020. Net loss came in at $7.4m or $0.18 per share compared to net loss of $3.0 million or $0.11 per share in the first quarter of 2020.
Blink Charging's Q1 total revenue - a 72% YoY rise
Blink Charging’s revenue might seem underwhelming, but future growth rates look promising.
Hitting its full year revenue target would mean a 99.2% year-on-year increase. For full year 2022, expectations are that Blink will post revenues of $24.56m, up 97.9% year-on-year. Should Blink Charging manage to continue to double revenue as expected and increase the number of charging stations, the share price may make a value buy right now.
Analysts have pinned a $42 price target on the Blink Charging stock - 24% higher than Friday’s close. Of the five analysts polled on website marketing sentinel in July, five rated Blink Charging a ‘buy’, while one rated it a ‘hold’.