With the transition to EVs happening at a faster and faster rate each year, investors have been looking at ways to get exposure to this industry. While it has been very popular to invest in EV manufacturers like Tesla (NASDAQ: TSLA) and NIO (NYSE: NIO), many people are looking for alternative opportunities.
Blink Charging Co (NASDAQ: BLNK) is one of those companies that has been garnering plenty of attention as it continues to roll out its charging equipment across more than a dozen countries. This article will look to see if Blink Charging stock is a good investment.
The bull case for Blink Charging
To date, Blink Charging has deployed more than 30,000 EV charging ports in 13 nations, including in the U.S. It is constantly looking to further expand its operations and to gain more of a slice of the market.
A lot of these charging stations are a part of the Blink Network. The company has been following an aggressive growth strategy in order to gain a good foothold in the market. This includes acquiring the European charging operator Blue Corner in May, a company that has sold or deployed over 8,700 independent charge points.
The company’s Q2 results showed a 177% rise year-on-year in revenue to $4.4 million. Its fastest growing segment was from its charging services, with revenue increasing 572% year-on-year. The number of Blink-owned charging stations deployed or contracted during the quarter rose 46% compared to Q2 2020. Finally, it sold, contracted or deployed 3,264 residential and commercial EV charging sections in Q2, up from 380 in the same quarter last year.
Another positive for investors is that the cash and marketable securities that Blink Charging holds was $195.6 million at the end of the most recent quarter, up from $22.3 million at the end of 2020. Therefore, it has a good war chest to play with as it continues its expansion.
The bear case for Blink Charging
The share price for Blink Charging often tends to rise and fall in line with other clean energy stocks. Therefore, this is something that investors need to consider before buying into Blink Charging. Despite a July full of positive announcements, Blink Charging’s share price fell by over 16%.
The EV charging sector is a competitive one, which means that Blink Charging is going to have to work hard for any gains that it makes. This means that further acquisitions and expansion could come at a hefty price.
Its net loss of $13.5 million in Q2 was wider than the forecasts. Blink Charging management put this down to higher compensation, general and administrative expenses. It made numerous high-profile appointments to its management team, causing compensation expenses to almost quadruple.
So, should I buy Blink Charging stock?
While the Blink Charging sales growth in Q2 was impressive, it still only has managed to generate revenue of $6.6 million so far in 2021, while having a market cap of about $1.37 billion. Therefore, investors are speculating on Blink Charging being a major player in the EV charging sector in the future rather than looking at the short term. With so much competition in the space, Blink Charging is a speculative investment that may or may not pay off down the road.
Who is the Blink Charging CEO?
Michael D. Farkas is the CEO of Blink Charging.
Is Blink Charging profitable?
Blink Charging had a net loss of $13.5 million in Q2 2021.
Does Blink Charging pay a dividend?
Blink Charging does not currently pay a dividend.
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Contributing Writer at MyWallSt
Andrew is a contributing writer to MyWallSt. He is a full-time finance writer, having spent time working in the industry. He studied Economics and Finance and has been fascinated with the financial markets since his teens. The first stock that Andrew bought was Apple, reflecting his love for its products.