Bank Of America Forecasts 118% Growth For This Under-The-Radar EV Charging Stock

Pod Point's shares, which are listed on the London Stock Exchange, are expected to shoot up by 118% over the next 12 months as a result of its expansion into the electric charging infrastructure space.

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In a note on April 11, the investment bank raised its price target to £1.74 and predicted the company's shares would rise. It was trading at £0.78 on Thursday, up more than 20% this year.

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EV sales in the U.K. are on the rise, leading Bank of America to expect a boost in charging infrastructure demand.

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During the first quarter of 2023, registrations of battery electric vehicles have grown by 15% year-to-date, according to the UK's industry lobby group, the Association of Motor Manufacturers and Traders, and battery electric vehicle sales are expected to hit record highs.

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According to the SMMT, the increased production lead times indicate that with the supply chain challenges gradually easing throughout the year, production lead times should return to normal during the course of the year.

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As a result of the upward revision of the Bank of America's estimates, they now expect EV sales in the U.K. to rise by 3-4% between 2023 and 2025 compared to their earlier estimates in February.

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In addition to producing electric vehicle chargers, Pod Point manufactures its own electricity network and offers its customers access to electricity in the United Kingdom and Norway, with a market capitalization of £120 million ($150 million). Based on FactSet data, France's state-owned energy company, EDF, has held a 54% stake in the company since 2020.

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Last year, it became a "preferred" supplier of home chargers for German automaker BMW, as a result of its work in installing charging stations at supermarkets in the U.K. Founded in 2009, the company also maintains hundreds of charging stations at supermarkets in the U.K.

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In a note to clients on April 11th, analysts led by Marianne Bulot in Bank of America with the subject of UK charging infrastructure reiterated a Buy rating because they still see Pod Point as the #1 in the market, and they said the company has >100% upside potential."

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A BofA spokesperson said the discounted valuation for Pod Point shares is "unjustified" given the company's growth in recent years.

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According to analysts, the industry will grow by a compound annual rate of 50 percent until 2025 and by around 35 percent for the next decade.

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