With plenty of tailwinds behind the electric vehicle sector, Canadian EV charging solutions provider Hypercharge Networks (Hypercharge Networks Stock Quote, Charts, News, Analysts, Financials NEO:HC) is one to watch, according to Haywood Capital Markets analyst Gianluca Tucci, who on Tuesday released a Watchlist Report on the company.
Vancouver-based Hypercharge, which listed on the NEO Exchange last month, launched its EV charging solutions business this past April, with over 600 charging ports at 102 sites now sold and an aim to expand across the North American market. The company focuses on installing units at residential and commercial buildings, along with fleet operations and with public as well as private businesses.
In June, Hypercharge raised $6 million in a private placement financing round at $0.60 per share, while since its listing date on November 16 the stock, with a market cap at $37 million, is currently trading at the same $0.60 level.
Tucci said EVs are still in the early adoption phase, with economics in the space rapidly improving. Tucci said while the majority of charging in upcoming years will take place at home, charging away from home will be key to support EV growth. And Hypercharge sells home-charging, with multi-unit residential buildings as one of its key markets.
“While EVs account for about five per cent of new vehicle registrations in the US according to Experian and about seven per cent in Canada as per StatsCan, the economics of EV ownership are improving,” Tucci wrote.
“Federal and State regulators are aggressively incentivizing adoption, and EV penetration will likely steadily increase over the next decade. President Joe Biden has pledged to extend EV tax credits and California has moved to ban new internal combustion engines from 2035 onward,” he said.
As for Hypercharge, whose main focus is Canada, Tucci said there are a lot of greenfield opportunities where incumbent charging providers are nonexistent, leaving plenty of runway for the company.
“Driven by its mission to accelerate EV adoption and enable the shift towards a carbon neutral economy, Hypercharge is committed to providing seamless, simple charging solutions by offering industry-leading equipment and a robust network of public and private charging stations,” Tucci said.
Tucci noted management’s business objectives, which include hitting revenue of $1-$2 million by the end of 2022, for which the company is currently on track, along with winning its first multi-unit residential builder partnership, one which was achieved in the current quarter with a key developer in the Toronto area. The company hopes for US expansion over the first quarter of 2023.
“Hypercharge has remained committed to its objectives, where its said/do ratio is trending positively,” Tucci said.