In a dramatic turn of events, ChargePoint Holdings (CHPT.N) witnessed a staggering 34% drop in its stock value on Friday, setting a new record low, in the wake of a revised third-quarter revenue forecast and significant executive changes.
At the time of this publication, ChargePoint Holdings Inc stock (CHPT) has witnessed a decline.
CHPT
ChargePoint Holdings Inc
Current Price: $2.04
Change : -1.10
Change (%): (-34.98%)
Volume: 70.6M
Source: Tomorrow Events Market Data
ChargePoint Holdings, headquartered in California, disclosed that it anticipates a substantial revenue decline to a range of $108 million to $113 million. This falls significantly below the earlier projection of $150 million to $165 million. The company attributed this downturn to sluggish demand caused by delays in electric vehicle deliveries across North America and Europe. The announcement was made after the market closed on Thursday, with the third-quarter results slated for release on December 6.
In a surprising move, long-time Chief Executive Pasquale Romano is stepping down, to be immediately replaced by Rick Wilmer, the company’s Chief Operating Officer. Simultaneously, Rex Jackson, ChargePoint’s Chief Financial Officer, has left the company, and the interim replacement is Mansi Khetani, a Senior Vice President.
As a consequence of these developments, ChargePoint’s stock plummeted to an unprecedented $1.95, marking an 80% year-to-date decline. This is a mere fraction of its initial closing price of approximately $30 when the company went public through a merger with a special purpose acquisition vehicle in 2021.
Following the alarming news, several financial analysts, including JPMorgan, Cowen, Oppenheimer, and Needham, swiftly adjusted their price targets for ChargePoint’s stock. One analyst even downgraded its rating on the company. According to LSEG data, the median price target from 22 analysts covering the company dropped to $8.13, down from $10 just a month ago. Nevertheless, the overall recommendation remains a cautious “buy.”
JPMorgan analysts, led by Bill Peterson, expressed their concern in an investor note, stating, “Based on recent investor interactions and multiple negative datapoints across the EV value chain, sentiment in the EV charging space has been muted, and we are not surprised that ChargePoint F3Q (third-quarter) revenues would track below expectations.” They added that the severity of the miss and the late-quarter deceleration raise concerns for both ChargePoint and the broader EV value chain.
The repercussions extended beyond ChargePoint, affecting other major players in the EV charging network sector. Blink Charging (BLNK.O) saw an over 8% decline, and EVgo Inc (EVGO.O) dropped 2%.
Despite the challenges, Oppenheimer analysts, led by Colin Rusch, acknowledged ChargePoint’s continued leadership in technology and comprehensive solutions. However, they downgraded the company’s rating from “outperform” to “perform,” citing the recent executive departures, unpredictable demand, and the potential for further organizational changes.
As ChargePoint braces for the release of its third-quarter results in early December, the market remains watchful, anticipating the impact of these setbacks on the company’s future trajectory.
