EVgo Analyst Remains Cautious On Still-Unproven Owner/Operator Model Despite Potential For Charging Business

Needham analyst Chris Pierce reinstated the coverage of EVgo Inc EVGO with a Hold rating.
Last week EVGO reported 4Q results above consensus, and introduced FY23 guidance, notable for the wide range of potential revenue outcomes.
A visit to EVGO's Innovation Lab in Southern California left the analyst with a positive view of the company's ability to control what they can control.
The analyst wants EVGO to push its manufacturing partners to produce DCFC chargers at increasingly high standards.
EVgo is a pure-play DCFC installer with relationships with several OEMs and large fleet customers, noted the analyst.
The analyst opined that the company largely employs an owner-operator model and generates revenue from electricity sales to EV drivers, but is moving into hardware sales with their General Motors Company GM GM/Pilot Flying J collaboration.
Related: GM Ties Up With Warren Buffett-Backed Firm To Build National EV Charging Network
The analyst is positive on EVgo's opportunity set, both in the short term as a seller of charging equipment, and longer term as a seller of electricity.
The analyst thinks long-term Street expectations are too aggressive, particularly in charging revenue where limited data makes forecasting difficult.
Price Action: EVGO shares are trading lower by 8.03% at $6.59 on the last check Wednesday.
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