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ChargePoint Stock May Start Gunning for Analysts’ Price Targets

ChargePoint Holdings (NYSE:CHPT) has been called both the future of electric vehicle infrastructure and a fallen star. The company boasts the largest network…

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This article was originally published by Investor Place

ChargePoint Holdings (NYSE:CHPT) has been called both the future of electric vehicle infrastructure and a fallen star. The company boasts the largest network of EV charging stations in North America and Europe, with more than 118,000 activated ports at the end of July. But Wall Street’s inability to decide on a single narrative has contributed to volatility in CHPT stock and left investors questioning where shares are headed.

Source: YuniqueB / Shutterstock.com

CHPT stock has fallen more than 50% from its late-June high and is down about 20% in the past month to trade around $18 a share. However, the stock could be due for a reversal higher sooner rather than later if the company’s recent earnings results are any indication. After all, ChargePoint is a growth company, and growth companies rely on improving sales as a primary indicator of success. 

Analysts’ 12-month price targets for CHPT stock range from $24 to $46, with an average target of $34.45. If shares can reach the low end of the range, investors who get in now will see a profit of more than 30%. And a move to the consensus target would yield a return of more than 90%.

ChargePoint Reports Strong Revenue Growth

There was plenty in ChargePoint’s fiscal second-quarter earnings report, released in early September, to make me believe CHPT stock should rise.

The company recorded $56.1 million in revenue for the quarter, a 61% year-over-year increase. This was well ahead of analysts’ consensus estimate of $49.1 million. Even more impressive, networked charging revenue jumped 91% during the same period to $40.9 million. And subscription revenue was up more than 23% to $12.1 million.

Again, as a growth company, this all bodes well for ChargePoint. And so does management raising its full-year guidance by 15% following the results. They now expect fiscal 2022 revenue of between $225 million and 235 million, which was $20 million to $30 million above what analysts were predicting at the time. 

Analysts have since raised their forecasts to bring them in line with management’s estimate. The consensus revenue target sits at $230.4 billion, which is 57% above the fiscal 2021 sales figure. 

From a revenue perspective, ChargePoint is clearly crushing it. However, there were some other less-than-rosy numbers in its quarterly results worth mentioning. 

Now, it’s not uncommon for a growth company like ChargePoint to post losses, especially this early on. However, things are not trending in the right direction. The company’s adjusted quarterly net loss was $40.4 million, up from $22.6 million in the same quarter a year ago. ChargePoint also saw its adjusted gross margin decline, falling to 23.1% compared with 25.7% a year ago.

The failure to expand margins and shrink its losses could be part of what’s weighing on CHPT stock. Since the company announced earnings on Sept. 1, shares are down more than 15%.

The Future of EV is Bright

Another thing likely holding shares back over the past month is the lack of movement on a U.S. infrastructure bill.

In August, the Senate passed a $1.2 trillion infrastructure package that included $7.5 billion earmarked for the installation of electric vehicle charging stations across the country. However, the proposal has been delayed in the House of Representatives and negotiations are ongoing.

This week, Senate Majority Leader Chuck Schumer said the Democrats will try to get a bipartisan infrastructure bill passed by the end of October, but whether that will happen is anyone’s guess. Clearly, billions of federal dollars spent on EV charging infrastructure would be a boon for ChargePoint.

As legislators continue to hash out an infrastructure plan, recent moves by major automakers bode well for the EV market.

In late September, Ford (NYSE:F) announced it will build two lithium-ion battery plants in Kentucky, along with a 3,600-acre campus in Tennessee that will include a battery plant and a new assembly plant for electric trucks. The joint venture with South Korea’s SK Innovation is expected to cost more than $11.4 billion and create 11,000 jobs. This is in addition to the $30 billion Ford previously pledged to put toward electric vehicles through 2025.

Ford isn’t the only U.S. automaker rushing to expand its capacity in the EV market, though. Back in June, General Motors (NYSE:GM) said it planned to increase its investment in electric and autonomous vehicles by 75% to $35 billion by 2025. 

The Bottom Line on CHPT Stock

Only time will tell how the expanding electric vehicle landscape will translate into growth — and hopefully profits — for ChargePoint. But the future looks bright indeed. Analysts predict ChargePoint will grow revenue by 57% this year and 59% next year, which should help investors overlook the company’s losses.

EV stocks have fallen out of favor in recent months, and CHPT stock is likely to remain volatile. However, shares are attractive as a long-term bet. And any positive news, such as the passage of an infrastructure bill or further EV capital commitments from corporate America, could result in shares running up to analysts’ price targets much sooner than anticipated. 

On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Alex Sirois is a freelance contributor to InvestorPlace whose personal stock investing style is focused on long-term, buy-and-hold, wealth-building stock picks. Having worked in several industries from e-commerce to translation to education and utilizing his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.

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Author: Alex Sirois

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Energy & Critical Metals

Sparc’s game changing joint venture could create low cost ‘ultra green hydrogen’ without electricity

Special Report: One of the core technologies in the fight against climate change is green hydrogen, clean-burning H2 gas produced … Read More
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One of the core technologies in the fight against climate change is green hydrogen, clean-burning H2 gas produced by sending an electrical pulse – generated by wind or solar power – through water.

While it has support from the upper echelons of the business world, a major roadblock to the production process is its cost relative to current forms of hydrogen production, which use fossil fuels as a feedstock.

But what if you never had to produce electricity at all?

Sparc Technologies (ASX:SPN) today announced it will link up with the University of Adelaide to progress an Australian made “ultra green hydrogen” technology that does not require electrolysis to extract the lightweight gas from water.

Without the costs of generating renewable energy, the project partners are targeting a commercial scale technology to help meet the $2/kg target widely regarded as the mark green hydrogen needs to limbo under to be cost competitive.

Game changing technology

Marking a big move for the graphene technologist into green energy, Sparc Technologies believes the globally significant project can be a game changer for the hydrogen industry, expected to be worth up to US$12 trillion globally by 2050.

“Green hydrogen energy has often been touted as being able to provide base load electricity, however it has struggled to compete economically against conventional fossil fuel base load electricity,” Sparc Technologies executive chairman Stephen Hunt said.

“This globally significant project offers a realistic pathway to achieving economically feasible green hydrogen energy and to advancing industry to net-zero.”

Hunt said Sparc was looking at applying its existing graphene expertise in the green energy space as well, developing graphene coatings to be used in conjunction with a catalyst in the production process.

“Developing additional graphene applications in the ultra-green hydrogen energy space is also a very important growth opportunity for Sparc.”

The process

The ultra green hydrogen process developed by University of Adelaideand Flinders University.

It involves the use of photocatalysis, the acceleration of a photoreaction in the presence of a catalyst.

In catalysed photolysis, light is absorbed by an adsorbed substrate. In photogenerated catalysis, the photocatalytic activity depends on the ability of the catalyst to create electron–hole pairs, which generate free radicals like hydrogen to be able to undergo secondary reactions.

Photocatalytic water splitting is an artificial photosynthesis process with photocatalysis in a photoelectrochemical cell used for the dissociation of water into its constituent parts.

In other words, only light energy and a catalyst could be needed to split water into oxygen and hydrogen, which has emerged as the likely replacement for gas and diesel in heavy industry and long haul vehicles.

On top of the potential cost savings, without the footprint associated with massive scale wind and solar farms, the technology can also be adopted remotely at the site of use, reducing the development and transmission costs of electricity and transport.

So far there has been plenty of research into the topic, but no technology has been commercialised.

Sparc and the University of Adelaide are looking to change that.

Sparc
The Ultra Green Hydrogen Process. Pic: Sparc Technologies

Joint Venture terms

The Australian Solar Thermal Research Institute, the UoA and Flinders University have invested $2.5m to date over a 5-year period into the research.

A provisional patent was applied for in April 2021, and research has already been undertaken on the use of graphene to be used in conjunction with the photocatalyst, where the prototype demonstrated a significant increase in hydrogen production with certain temperatures.

Under the JV the University of Adelaide will retain 28% of the JV with Sparc taking a 72% share.

Sparc will issue 3 million shares to UoA and put $4.75 million into the project over the next 4.5 years, including $2m for the 2.5 year first stage, $2.5m over the second stage and $250,000 to be paid to UoA for operations set up and a scholarship.

“This is an exciting opportunity for us to combine with the University of Adelaide, reconfirming our commitment to seeking out and developing new green technologies that include Sparc graphene technology,” Sparc managing director Mike Bartels said.

“The hydrogen production process we are developing is world leading, cutting-edge in that it does not require electrolysis as the means of producing hydrogen.

“Employing patented technology, hydrogen will be produced by a process known as photocatalysis and most importantly this project is not just about delivering green hydrogen – we are confident that this process will deliver ultra-green hydrogen at the low end of the cost curve.

UoA Executive Director, Innovation & Commercial, Dr Stephen Rodda said: “This joint venture is a perfect example of the University of Adelaide’s internationally regarded research being brought to a commercial outcome, which we hope will have benefits for industry and the community.

“We are proud to be the leading university involved in this venture, applying our research and innovation in responding to one of the great challenges of our times: the development of green energy solutions for our planet.”

Placement to fund JV

Sparc has received firm commitments to raise $2.8 million before costs, via a placement of 4 million shares at 70c a pop.

The placement, conducted at a 21.8% discount to Sparc’s last traded price of 89.5c, was conducted by Discovery Capital Partners and Westar.

 


 

 

This article was developed in collaboration with Sparc Technologies, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

 

The post Sparc’s game changing joint venture could create low cost ‘ultra green hydrogen’ without electricity appeared first on Stockhead.

Author: Special Report

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Energy & Critical Metals

Explorers and Developers Targeting Cobalt Projects

By Ellsworth Dickson Historically, the metal cobalt was a by-product of mines that were mainly…

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By Ellsworth Dickson

Historically, the metal cobalt was a by-product of mines that were mainly concerned with other metals, for example, silver. That was the case for the1903 silver rush around the Town of Cobalt in northeastern Ontario. The hundreds of veins in the camp featured high-grade silver values accompanied by several cobalt minerals.

The silver rush was slow to get started but by 1906 there were 263 mining companies in the Cobalt district. Many famous mines were built such as the Coniagas, Nipissing 407, Agaunico, Silverfields, O’Brien, Glen Lake Mines, Deer Horn Mines, Agnico, Temiskaming, Trethaway, Hi-Ho, Cart Lake and more.

Silver mining continued into the 1980s with cobalt still of secondary interest. The Cobalt area mines lay dormant until about 2017 when the rising price of cobalt resulted in a staking rush with both cobalt and silver of interest. Since 2017, there have been a number of activities in the Cobalt camp – exploration and drill programs, staking, new discoveries, consolidations, changes of plans, and so on. The initial fever has naturally given way to people in it for the long haul. (more later on)

Cobalt is used to make superalloys, high-temperature alloys, cutting tools, magnetic materials, petrochemical catalysts, pharmaceuticals, steels and glaze materials. Back in the 1990s, only 1% of cobalt demand was from its use in rechargeable batteries.

Today, the cobalt market is largely being driven by “new economy” drivers, including lithium-ion batteries, consumer electronics, Electric Vehicles (EVs) and Energy Storage Systems (ESS) that are the dominant uses for lithium-ion batteries, representing 64% of cobalt demand in 2020.

Various world governments have actually mandated the manufacture of EVs and the tapering off of internal combustion engines, resulting in an EV sales growth forecast of 30%. Consequences of the COVID virus have sometimes affected the cobalt marker but that will eventually end. Cobalt is currently trading at US$24.03 per pound, up about 57% from a year ago. Consequently, cobalt explorers and developers have targeted projects in various locales around the world.

Cobalt, being a fairly rare metal, means that there are not that many cobalt projects or mines – either as a primary commodity or as a secondary product, usually with copper, nickel or silver Cobalt is not like, say, the gold or copper sector that generates many projects and mines.

Commodity trader and miner Glencore Plc [GLEN-LSE] recently said it will restart operations at the world’s largest cobalt mine, Mutanda in southeast Democratic Republic of Congo (DRC), towards the end of this year and return to production in 2022.

The DRC (Kinshasa) continues to be the world’s leading source of mined cobalt, supplying approximately 70% of global mine production. The use of child labour at artisanal mines is a big problem.

According to the United States Geological Survey, 2020 mine production was DRC: 95,000 tonnes; Russia: 6,300 tonnes; Philippines: 4,700 tonnes; Canada: 3,200 tonnes; China: 2,300 tonnes; U.S.: 600 tonnes; and Australia: 5,700 tonnes. In 2020, total global production in 2020 was 140,000 tonnes with world reserves pegged at 7.1 million tonnes.

The 2021 diamond drilling program at the Fortune Minerals NICO Project, NWT.

Thanks to the burgeoning EV industry, cobalt demand is expected to steadily increase as manufacturing ramps up which bodes well for the cobalt sector.

Besides northeastern Ontario, there are not a great number of other cobalt projects in North America. One company that stands out is Fortune Minerals Limited [FT-TSX] that has attracted investor interest because its flagship NICO project in Canada’s Northwest Territories that is one of the most advanced cobalt development assets outside the Democratic Republic of Congo (DRC).

Fortune is one of only a handful of global companies that could emerge as a possible supplier of “ethical cobalt” to consumers seeking an alternative to the DRC, currently the source of over 60% of the world’s production.

Amnesty International has warned electric car companies to seek out alternatives to the DRC, which is well known for its mineral wealth, but also civil wars and corruption.

However, Fortune is more than just a play on cobalt. The unique metal assemblage of the NICO deposit includes open pit and underground proven and probable reserves of 33 million tonnes, containing 1.1 million ounces of gold, 82 million pounds of cobalt, 102 million pounds of bismuth, and 27 million pounds of copper.

According to a 2014 feasibility study and recent optimizations, that material could support average annual production for the first 14 years of a 20-year mine life (2020 mine plan), including 1,800 tonnes per year of cobalt in battery grade cobalt sulphate, 47,000 ounces per year of gold in doré bars, 1,700 tonnes per year of bismuth in ingots and oxide and 300 tonnes per year of copper in cement precipitate.

The study suggest that ore can be extracted from a proposed open pit and underground mine and mill that will produce a bulk concentrate for shipment to a refinery that the company plans to construct in southern Canada.

The products that would be produced at the proposed refinery include cobalt chemicals used to make high performance rechargeable batteries, bismuth metals and chemicals, as well as gold.

It is worth noting that the company has received environmental assessment approval and key permits to construct and operate the NICO mine and concentrator in the Northwest Territories.

Fortune also owns the satellite Sue-Dianne copper-silver-gold deposit, located 25 kilometres north of the NICO mine site and other exploration projects in the Northwest Territories, and maintains the right to repurchase the Arctos anthracite coal deposits in northwest British Columbia that were previously bought by a British Columbia Crown corporation.

A helicopter prepares a diamond drill pad at the Fortune Minerals NICO Project, NWT.

Fortune sees Sue-Dianne as a potential future source of incremental mill feed that could extend the life of a NICO mill and concentrator

Sue-Dianne hosts an indicated resource of 8.4 million tonnes grading 0.80% copper, 3.2 g/t silver and 0.07 g/t gold. On top of that is an inferred resource of 1.62 million tonnes of grade 0.79% coper, 2.4 g/t silver and 0.07 g/t gold.

“Cobalt has a critical role in the accelerating transition to e-mobility, and advanced assets like our NICO Project are needed to help satisfy the growing demand and diversify the supply chain,” said Fortune President and CEO Robin Goad.

The NICO project is located 160 kilometres northwest of Yellowknife and 50 kilometres north of Whati, a First Nations community in the North Slave region

Due to the remote location, the Tlicho Highway, under construction for the NWT government, is a key enabler for the NICO development and is nearing completion and expected to open to the public later this year. The $213 million, 97-kilometre all-season road to the community of Whati, together with the spur road that Fortune plans to construct, will allow metal concentrates to be trucked from the mine to the rail head at Hay River or Enterprise, NWT for railway delivery to the company’s planned hydrometallurgical refinery.

Fortune has talked about a total project cost of around $775 million. But the focus now is on various optimizations and refinery sites aimed at delivering a more financially robust project compared to the one envisaged in the 2014 feasibility study.

In keeping with that effort, Fortune recently launched a 3,000-metre drill program to test for a potential expansion of the NICO deposit at the east end of the deposit. It said exploration crews will also test up to four additional targets defined by previous geology and geophysics programs.

Fortune recently raised almost $542,000 from a private placement offering of 3.9 million issued that were issued at 14 cents per unit. It also received a grant of $144,000 from the Government of the NWT.

On October 22, 2021, Fortune shares were trading at $0.13 in a 52-week range of 27 cents and $0.06, leaving the company with a market cap of $47.58 million based on 366 million shares outstanding.

Other companies within the cobalt mining space worth mentioning include:

Canada Silver Cobalt Works Inc. [CCW-TSXV; CCWOF-OTC] recently reported high-grade cobalt assays from its Castle East discovery located 1.5 km from its 100%-owned, past-producing Castle Mine near Gowganda in the silver-cobalt district northeast of the Town of Cobalt where the company has completed 42,000 metres of a 60,000-metre drill program aimed at significantly increasing its 43-101 resource estimate. Canada Silver Cobalt Works recently discovered a major high-grade silver vein system at Castle East. The company also has a pilot plant and processing facility.

Kuya Silver Corp. [KUYA-CSE] has given notice of intention to exercise an option to earn a 70% interest in all of First Cobalt Corp.’s [FCC-TSXV; FTSSF-OTCQX] remaining mineral rights in the Cobalt camp. Kuya previously acquired a 100% interest in a property package surrounding the Kerr Lake area for $4-million.

First Cobalt owns a hydrometallurgical cobalt refinery in the Town of Cobalt. The refinery has the potential to produce either a cobalt sulfate for the lithium-ion battery market or cobalt metal for the North American aerospace industry or other industrial and military applications.

With permits and building infrastructure already in place, the First Cobalt Refinery will be operational as early as 2022. Once operational, the Refinery will produce 25,000 tonnes of battery-grade cobalt sulfate per annum, representing more than 5 per cent of all cobalt produced around the world.

Cruz Battery Metals Corp. [CRUZ-CSE; BKTPF-OTC; A2DMG8], formerly Cruz Cobalt Corp., completed a three-hole, 837-metre diamond drill campaign at the Hector Silver-Cobalt property. The company is a large mineral land holder in the Cobalt area and also includes the Bucke, Coleman, Johnson and Lorraine prospects.

Fuse Cobalt Inc. [FUSE-TSXV; FUSEF-OTC; 43W3-FSE], formerly Lico Energy Metals, recently reported that the government of Ontario announced a joint $10-million investment in the First Cobalt refinery in Cobalt Ontario. Significantly, this refinery is located approximately 1,500 metres west of the company’s cobalt exploration property. Fuse holds the Teledyne Cobalt property in Bucke and Lorrain Townships as well as the Glencore Bucke property located on the west boundary of the Teledyne property.

Brixton Metals Corp. [BBB-TSXV; BBBXF-OTCQB] has 100% interests in the Langis-Hudbay silver-cobalt project near the Town of Cobalt. The Langis Mine produced 10.4 Moz silver at 25 oz/ton and 358,340 lbs of cobalt between 1908 and 1989. Between 1903 and 1953 the Hudson Mine produced 4 million ounces of silver and 185,570 lbs cobalt.

iMetal Resources Inc. [IMR-TSXV; ADTFF-OTC] reported grab sample values of 67.9, 29.6 and 11.3 g/t gold from its flagship Gowganda West property.

The Eagle mine of Lundin Mining Corp. [LUN-TSX; LUNMF-OTC; LUMI-Sweden] in Michigan produces a cobalt-bearing nickel concentrate.

Jervois Global Ltd. [JRV-TSXV, ASX; JRVMF-OTC] is constructing the Idaho cobalt project (ICP) about 40 km from Salmon, east-central Idaho. It is a primary cobalt deposit with production estimates of 1,200 tons per day of super-alloy grade high-purity cobalt metal over a 7-year mine life.

The company has committed more than US$30-million toward equipment, materials and labour costs, both on-site and for detailed engineering. Construction, procurement and engineering schedule is on time with plan and commissioning of the mine expected from mid-2022. Currently, underground construction has commenced.

The company said that this historic step marks the first time in decades that the United States will have a primary cobalt mine within its borders.

Bryce Croker, CEO of Jervois, said, “Cobalt is a crucially important material for both defense and civilian applications. The electrification of the United States and global transportation sectors are currently and expected to continue driving exceptional cobalt demand growth.”

Some analysts are predicting a 17% increase in cobalt demand this year over 2020 and even more demand in the future due to the electrification of the world’s vehicle fleet. For example, the Ford Motor Company [F-NYSE] recently announced a US$11 billion investment to build electric vehicles in Tennessee and Kentucky, creating 11,000 new jobs. News doesn’t get much better than that.

 

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Author: Resource World

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Energy & Critical Metals

ALX Resources Stock Up 8% Today – Announces Ground Prospecting Program At Javelin And McKenzie Lake Uranium Projects

ALX Resources Corp. (TSXV: AL) reported today that it has mobilized a helicopter-supported ground prospecting program at the Javelin…

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[nxtlink id="268766"]ALX Resources Corp.[/nxtlink] ([nxtlink id="268766"]TSXV: AL[/nxtlink]) reported today that it has mobilized a helicopter-supported ground prospecting program at the Javelin and McKenzie Lake uranium projects in northern Saskatchewan, Canada. The program aims to target radioactive anomalies identified in the firm’s concluded airborne radiometric and magnetic survey.

 

The two properties are located near the eastern margin of the Athabasca Basin within 65 kilometres southeast of the McArthur River uranium mine. The company’s claims on the properties were acquired during a staking rush that began in mid-September 2021.

In September and October 2021, the company tapped Special Projects Inc. to survey the properties with a radiometric system. The survey covered a total of approximately 306 square kilometres.

The program will prospect the areas identified by the survey as having elevated radioactivity. Prominent structural features with historical mineral showings will also be examined.

ALX Resources last traded at $0.125 on the TSX Venture.


Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

The post ALX Resources Announces Ground Prospecting Program At Javelin And McKenzie Lake Uranium Projects appeared first on the deep dive.

Author: ER Velasco

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