ChargePoint Holdings Inc. (NYSE:CHPT) has secured its spot because the market leader within the U.S. EV charging network, boasting a commanding 32% share and greater than 70,000 ports nationwide.
The corporate’s network has overtaken Tesla Inc (NASDAQ:TSLA) and other major players, highlighting ChargePoint’s expansive reach amid growing EV adoption. Despite this impressive lead, JPMorgan analyst Bill Peterson maintains a cautious stance, placing ChargePoint on the firm’s Short Ideas list.
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Market Growth Outpaces EV Sales
The U.S. EV charging sector witnessed record-breaking growth in 2024, with over 40,000 public chargers deployed — up from 27,000 in 2023. Peterson noted that the deployment of DC Fast and Level 2 chargers significantly outpaced the expansion in underlying EV sales.
Nonetheless, this rapid expansion has created utilization challenges, because the fleet of fast chargers struggles to maintain pace with rising demand. Adding to the strain are sluggish subsidies and high capital expenditures, each of that are expected to keep up pressure on charger utilization into 2025.
Operational, Political Risks Loom
ChargePoint’s dominant market position hasn’t shielded it from industry headwinds. Peterson cautions that demand recovery stays unclear, particularly as business and fleet customers delay recent deployments amid tightened budgets and unsure economic conditions.
Adding to those concerns, political risks loom large. Peterson highlights the potential for weakened EV tax credits under a possible “Trump 2.0” scenario, which could significantly impact consumer EV adoption and customer sentiment.
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On JPMorgan’s Short Ideas List Despite Long-Term Potential
While JPMorgan acknowledges improvements to ChargePoint’s cost basis this 12 months, the firm stays on its Short Ideas list because of ongoing risks.
Negative year-over-year growth trends and broader market uncertainties contribute to the tempered outlook.