Benchmark maintains Buy rating on EVgo stock with $12 target

On Wednesday, Benchmark analysts remained optimistic about EVgo, Inc. (NASDAQ:EVGO), maintaining a Buy rating and a $12.00 price target for the company’s shares, representing significant upside from the current price of $2.48. EVgo’s fourth-quarter revenue for 2024 was reported at $67.5 million, slightly above Benchmark’s projection of $66.6 million but below the consensus estimate of $69 million. According to InvestingPro data, the company has demonstrated impressive revenue growth of nearly 60% over the last twelve months. The company’s performance was bolstered by the addition of 480 new charging stalls, surpassing the anticipated 210 stalls. This expansion brought EVgo’s total operational stall count to 4,080.

The network’s throughput for the quarter reached 84 gigawatt-hours (GWh), which was higher than Benchmark’s estimate of 74 GWh. This strong network utilization indicates a robust demand for EVgo’s services, particularly in areas of high density and high usage. According to Benchmark, this trend reflects a positive growth trajectory for the company.

Benchmark’s analysis suggests that EVgo is on a solid path towards financial sustainability. It is expected that the company will achieve EBITDA breakeven in 2025 and is forecasted to generate over $30 million in EBITDA by 2026. While InvestingPro data shows the company currently maintains an EBITDA of -$65.78M, analysts anticipate strong sales growth in the coming year. For deeper insights into EVgo’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers. The firm’s reiterated Buy rating and price target reflect confidence in EVgo’s strategic positioning and its potential for growth in the evolving electric vehicle charging market.

EVgo’s recent performance and strategic network expansion contribute to Benchmark’s positive outlook. The company’s ability to exceed operational expectations with its network throughput and stall additions positions it favorably within the competitive electric vehicle charging landscape.

The analyst’s statement highlighted the significance of EVgo’s achievements in the fourth quarter of 2024, "The strength in network throughput characterizes a healthy growth demand profile for the company as it continues to provide charging in high-density and high-utilization locations." This sentiment underscores the rationale behind Benchmark’s decision to reiterate their Buy rating and $12.00 price target on EVgo stock. Based on InvestingPro Fair Value analysis, the stock currently appears to be trading near its fair value, with analyst targets ranging from $3.50 to $12.00, reflecting diverse market perspectives on the company’s growth trajectory.

In other recent news, EVgo Inc. reported significant financial results for the fourth quarter and full year of 2024, highlighting a 35% year-over-year revenue increase to $67.5 million for Q4. Despite this growth, the company reported an earnings per share (EPS) loss of $0.11, which was larger than the anticipated loss of $0.09. For the full year, EVgo’s revenue reached $257 million, marking a 60% increase from the previous year, driven by a 110% surge in charging network revenues. The company also announced its ambitious revenue target for 2025, projecting between $340 million and $380 million, with plans to achieve EBITDA breakeven.

Cantor Fitzgerald maintained an Overweight rating on EVgo, with a price target of $8.00, citing the company’s utilization rate and network throughput as positive indicators. The reaffirmation of a Department of Energy (DOE) loan is seen as a crucial factor supporting EVgo’s expansion plans, which include building up to 7,500 new charging stalls. In Q4 2024, EVgo added 480 new DC fast charging stalls, bringing its total to 4,080 operational stalls. The company aims to expand its network significantly over the next few years, with targets set for fiscal years 2025 through 2027.

Analysts from Cantor Fitzgerald believe that EVgo is well-positioned to capitalize on the growing demand for electric vehicle (EV) charging infrastructure. The firm’s analysis suggests that the demand for EV charging is outpacing the supply, which could benefit EVgo’s growth trajectory. EVgo has also emphasized its strategic focus on expanding its charging network to meet increasing demand and improve its financial performance.

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