ChargePoint Holdings, Inc. (CHPT) shares are trading lower today following a cautious outlook from J.P.Morgan analyst Bill Peterson. Peterson expects ChargePoint’s second-quarter earnings, set to be released on September 4th, to align with guidance. However, he anticipates third-quarter guidance to fall short of consensus due to prevailing industry headwinds and a cautious near-term outlook.
While Peterson acknowledges that the second half of the year could see an improvement, he highlights the need for management to clarify its path to profitability under various demand scenarios, especially if revenue growth stagnates or declines. This emphasis on profitability comes as investor skepticism rises, fueled by negative trends reported by peers in the U.S. and Europe. The non-China EV market, in particular, shows no signs of recovery.
Investor sentiment could potentially improve if management confirms that the first half of the year represents the trough, supported by typical seasonality, slower commercial customer deployments, and positive growth prospects heading into 2025. Despite these concerns, Peterson maintains an Overweight rating for ChargePoint, recognizing the company’s potential for upside if it executes effectively in this challenging market.
Investors interested in gaining exposure to ChargePoint can consider ETFs like the SPDR S&P Kensho Intelligent Structures ETF (SIMS) and the Invesco WilderHill Clean Energy ETF (PBW).
