Gold is 2025’s best performer. UBS sees more upside
On Monday, Morgan Stanley (NYSE:MS) analysts initiated coverage on EVgo, Inc. (NASDAQ: EVGO), assigning the stock an Equalweight rating and setting a price target of $4.00. The analysts see a potential upside of 7% for the electric vehicle charging company, which currently commands a market capitalization of $1.15 billion. According to InvestingPro data, EVgo has demonstrated strong revenue growth of 45% in the last twelve months.
EVgo is considered well-positioned to capitalize on the growing penetration of electric vehicles, supported by its partnerships with major auto manufacturers such as General Motors (NYSE:GM), Nissan (OTC:NSANY), and Toyota (NYSE:TM). The company also collaborates with retail chains like Target (NYSE:TGT), Whole Foods, and Kroger (NYSE:KR), as well as ridesharing services including Uber (NYSE:UBER) and Lyft (NASDAQ:LYFT). InvestingPro analysis reveals the company maintains a healthy current ratio of 2.27, indicating strong short-term liquidity, though investors should note its high beta of 2.28 suggests significant market sensitivity.
Despite these advantages, the analysts highlighted certain risks to EVgo’s outlook. These include an uncertain policy environment for electric vehicles and robust competition from original equipment manufacturers like Tesla (NASDAQ:TSLA). Morgan Stanley believes that the current valuation of EVgo, at 13.8 times the estimated 2027 EBITDA, adequately reflects the company’s strong revenue and earnings growth potential alongside these risks. With analysts forecasting 37% revenue growth for the current fiscal year, EVgo presents an interesting case study in the EV infrastructure sector. For deeper insights and additional analysis, investors can access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 US stocks.
The price target of $4 per share is derived from a discounted cash flow analysis, implying a multiple of 14.9 times the estimated 2027 EBITDA. The analysts suggest that this valuation balances the company’s growth prospects with the observable risks. Based on InvestingPro’s Fair Value analysis, the stock appears to be trading near its fair value.
In other recent news, EVgo Inc. (NASDAQ:EVGO) reported its first-quarter 2025 earnings, revealing a strong financial performance with revenue reaching $75.3 million, surpassing analyst expectations of $71.4 million. The company reported a narrower-than-expected loss per share of $0.09, compared to the forecasted $0.11 loss. This marks a 36% year-over-year increase in revenue, with charging network revenue growing by 49% to $47.1 million. EVgo’s CEO, Badar Khan, expressed optimism for the second quarter, forecasting revenue between $340 million and $380 million, exceeding analysts’ expectations of $351.8 million. Additionally, EVgo announced an expansion of its 2021 Long Term Incentive Plan, adding 25 million shares to support talent acquisition and retention. In corporate governance updates, three Class I directors were re-elected, and KPMG LLP was ratified as the independent registered public accounting firm. Stifel analysts maintained a Buy rating on EVgo, with an $8.00 price target, citing the company’s promising developments and confidence in its strategic direction.
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