We recently published a list of 11 Best EV Charging Stocks To Invest In. In this article, we are going to take a look at where Enphase Energy (NASDAQ:ENPH) stands against other best EV charging stocks.
Over the last few years, the electric vehicle (EV) market has experienced significant growth, due to consumer demand, automaker investments, and substantial government support. In the US, the $7.5 billion from the 2021 Infrastructure Investment and Jobs Act and tax credits from the Inflation Reduction Act have also fueled EV growth.
According to the International Energy Agency (IEA), global public charging points are expected to exceed 15 million by 2030 and will increase to nearly 25 million by 2035. In the U.S., the government aims to install 500,000 public charging ports by 2030, with the total number of chargers expected to reach 900,000 in 2030 and 1.7 million by 2035.
Globally, home charging is expected to grow to over 270 million units by 2035, with more than 45% of electricity coming from public or private non-home chargers. Charging infrastructure for heavy-duty vehicles (HDVs) is also expected to grow significantly. By 2035, installed HDV charging capacity is projected to reach 2,000 GW. Policies like the EU’s Alternative Fuels Infrastructure Regulation and U.S. strategies are driving this expansion, alongside private investments.
The Road Ahead for EV Charging: Industry Growth and Challenges
According to PwC’s analysis, the number of charge points in the U.S. must grow from around 4 million today to 35 million by 2030 to meet demand. The PwC report has projected that the number of EVs could reach 27 million by 2030 and 92 million by 2040.
The EV supply equipment (EVSE) market is expected to expand from $7 billion to $100 billion by 2040, at a 15% compound annual growth rate. The market’s primary value pools are hardware, software, installation services, and charge point operators (CPOs). CPOs, which build, operate, and maintain charging stations, are expected to dominate and capture 65% of market revenue by 2040. On the other hand, hardware providers’ share will shrink from 46% today to 20% by 2040.
Despite the clear market opportunities, challenges remain, including educating consumers, financing infrastructure, and ensuring cost-effective solutions across different charging segments. Companies looking to enter or expand in the EVSE market will need to understand evolving customer needs, adopt appropriate business models, and prepare for long-term investments with a focus on strategic partnerships and potential acquisitions.
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Enphase Energy, Inc. (NASDAQ:ENPH)
Number of Hedge Fund Holders: 42
Enphase Energy, Inc. (NASDAQ:ENPH) is a prominent player in the energy technology space. It is known for pioneering solar micro-inverter technology, which converts direct current (DC) from solar panels into alternating current (AC) for use in homes and the grid.
The company focuses primarily on providing solar solutions to residential customers, including energy storage and electric vehicle charging products. Over the years, the company has expanded its product portfolio and global presence, shipping millions of micro-inverters across more than 140 countries.
In the EV charging space, its Enphase IQ EV Charger offers efficient and flexible charging solutions for electric vehicles. It connects to the internet and lets users monitor and control charging sessions through a digital interface. The technology helps optimize charging schedules for cost efficiency and reduced environmental impact.
Users can monitor energy consumption through the app based on their EV’s battery capacity and charger ratings, which ensures they charge within their vehicle’s limits. The app’s Status screen provides real-time data on energy usage, including a detailed breakdown of EV consumption.
Enphase Energy (NASDAQ:ENPH) is also one of the best clean energy stocks according to Reddit. The company stands to benefit from the U.S. Inflation Reduction Act (IRA), which provides a 10% Investment Tax Credit for solar products with U.S.-made components, which could improve potential sales and margins.
Despite reporting slightly lower-than-expected revenue and earnings in Q2 due to weaker European sales, the company has achieved a strong 47.1% gross margin. Growing competition hasn’t stopped the company from expanding its market. The company saw a 32% revenue increase from the U.S. in Q2 and has secured most of its Q3 revenue through pre-orders.
In the second quarter, Enphase Energy’s (NASDAQ:ENPH) stock was held by 42 hedge funds at a combined value of nearly $506 million. Coatue Management is the company’s biggest shareholder with 960,700 shares worth $95.8 million, as of June 30. It is among our best EV charging stocks to invest in.
Overall ENPH ranks 2nd on our list of the best EV charging stocks. While we acknowledge the potential of ENPH as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than ENPH but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure. None. This article is originally published at Insider Monkey.