US President Joe Biden's billion-dollar infrastructure plan is currently the talk of the town. Although it has not yet been decided exactly which industry will receive how much money from the pot, the e-mobility industry is also to be given a slice of the cake. According to a media report by Reuters, the Biden administration is proposing USD 174 bn to promote electric vehicles. Of this, USD 100 billion will go towards new consumer rebates and USD 15 billion will go towards building 500,000 new charging stations.
This state of affairs plays into Blink Charging's hands. The full-service provider of charging infrastructure is, by its own account, the market leader in charging stations and services for electric vehicles in the USA. The company offers everything from development and production to the operation of more than 24,000 charging stations from a single source. In addition, the company has a cloud solution for monitoring and operating the charging network. With these innovations, Blink is living up to its mission, proclaimed in 2009, to make an important contribution to slowing climate change by reducing greenhouse gases in transportation.
Even though much has already been achieved, experts still see enormous growth opportunities in the e-sector. In a recent analysis, the investment firm Cowen and Co sees great potential for electric vehicles. In their view, electric vehicles are only at the beginning of the turning point that will usher in a new era of clean mobility. One reason is the advanced battery technology, which increases the acceptance of e-cars among the population and thus also their sales. Cowen predicts that e-drive penetration will grow to 30% of car sales by 2030, and expects a parallel average annual increase in public charging infrastructure of around 37%.
Just a few days ago, Blink inked a new deal. The company is working with the Four Brothers Pizza Inn restaurant chain to provide 42 charging ports at 10 locations. These come from 21 of the fast IQ 200 charging points with two connections. "As electric vehicle use becomes more popular, drivers are looking for convenient and reliable charging options at restaurants and entertainment venues where they can park and charge," commented Brendan Jones, president and CEO of Blink Charging, on the collaboration, which is supported by the New York State Energy Research and Development Authority.
This continues the company's growth trajectory in 2021. Already last year, total revenue - boosted by product sales - increased by a whopping 121% to USD 6.2 million. Although the net loss also increased to USD 17.8m, the increased costs are expected to translate into higher future growth, according to Blink's management. The group also has visionary products such as lanterns that serve as charging sources in its quiver, which should further boost demand in the future. Cowen analysts expect Blink to post positive operating income (Ebitda) in 2023. The consensus listed by Refinitv is even a bit more optimistic, expecting a small bottom-line gain in 2023 already.
There are currently 3 analyst studies on Blink Charging that differ significantly in terms of the stock's upside potential. Estimates range from USD 38 at the low to USD 60 at the high. With the new Softcallable Barrier Reverse Convertibles it does not matter if the stock rises, stagnates and falls back to the lowest price target. The products have a barrier distance of 51%, which from today's perspective leaves room for the underlying to go down into the USD 22 range. Despite the high risk buffer, the profit opportunity is not neglected. The CHF version of the Barrier Reverse Convertible has an attractive coupon of 14.50% p.a., while the USD version even guarantees a payout of 15.50% p.a. The underlying has a high risk buffer. No price increases are required for the products to generate the maximum return in 15 months at the latest; only the barrier must remain intact. The term can be shortened to 6 months due to the soft callable function.
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