Last year, Volta Industries Inc. announced its intentions to go public via a merger with SPAC company Tortoise Acquisition Corp. II (NYSE:SNPR). The proposed merger was approved by shareholders and the combined company has now been trading publicly for 7 months.
The completed merger was valued at $1.4 Billion and Volta raised roughly $600 Million in cash proceeds. The proceeds will continue to fund Volta’s buildout of its charging network to meet its high demand across the United States. However, the past two quarters of trading have been a nightmare for tech investors as inflationary concerns, supply constraints and the Ukraine Crisis dehabilitating investor morale.
Volta is currently trading at a 60% discount from its PIPE offering price of $10, and investors are asking the question if the stock has finally bottomed out. With plenty of questions to answer, this article will breakdown the Volta Stock Forecast.
What investors need to know about the Volta Stock Forecast
Firstly, over the past decade Volta has built a nationwide electric vehicle charging network. Volta charging stations are among the most used in the United States. Volta’s business model is positioned strategically to capitalise on Megatrend tailwinds including electrification, decarbonization, digital media and big data. The company is targeting a $500 Billion refuelling market which will be up for grabs as the world transitions to zero carbon.
In a recent investor presentation, the company noted they have installed 2,137 charging stalls across 648 sites. In addition, the company has 1,128 stalls under construction expanding their footprint across 1,300 sites.
The Future of EV Charging
Volta Industries generated $25 Million in revenue in 2020 with majority of the revenue resulting from their charging network segment. For the current calendar year, the company forecasts revenues to be in the range of $32 million to $36 million. This is slightly down from the companies earlier assessments of 2021 revenues, with Volta previously predicting revenues closer to $47 million.
Over the next 5 years, the company expects a CAGR of 100% which is well above its direct competition. However, with supply constraints and inflationary pressures on costs for installation analysts are taking a more reserved approach.
In saying this, changes in the economic and political environment over the past few years have created a growing market for companies like ChargePoint. This includes Joe Biden’s $5 Billion investment to help states build EV Charging Infastructure to transition the country away from petroleum.
With additional pressure on oil and gas supplies in Russia, we can expect European Governments to speed up the transition to renewable energy sources including building an EV charging network. Overall, the company looks well positioned to benefit from the EV tailwind.
The Bottom Line
In summary, the SPAC merger between SNPR and Volta has provided essential capital for Volta to meet its growing demand backlog. The emerging market that Volta aims to tap into is clearly an exciting prospect for investors, especially with strong federal backing.
Lastly, the revenue guidance provided by the company highlights the emerging market opportunity. At this stage, the forecasts are based on certain variables being met in that time frame so we may see these forecasts change over time.
The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.
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