Maurice was pacing back and forth across his desk, occasionally hurling banana peels at a chart of EV adoption rates, muttering something about “infrastructure that actually matters” under his breath.
Listen, I’ve been in this business long enough to know that most “infrastructure plays” are just fancy ways of saying “we’re building stuff nobody asked for and hoping someone pays for it later.” But then I look at a company like EVgo, and something in my primate brain starts chattering excitedly because this isn’t about building widgets—it’s about building anxiety relief.
EVgo, Inc. owns and operates the fast-charging network for electric vehicles across the United States. And before you yawn and wonder if I’ve been sampling fermented bananas, let me explain why a small, unprofitable charging company is worth discussing right now.
Here’s the thing about bananas: their value isn’t in the banana itself. It’s in how hungry you are and how far you are from the next banana. Same principle applies to EV charging stations. If you’re driving an electric car and your battery’s at 12%, that charging station isn’t a convenience—it’s civilization itself. You’ll pay premium prices. You’ll use it repeatedly. And if the network is good, you’ll trust it enough to take longer road trips, which means you’re more likely to buy the EV in the first place.
EVgo gets this. They operate one of the largest DC fast-charging networks in America, and the numbers they’re putting up are genuinely impressive. They’re reporting 75.5% revenue growth. Not modest. Not “we’re-doing-okay” growth. Seven-five-point-five percent. I threw a banana at my monitor when I saw that figure because in infrastructure, this is the kind of growth that usually means you’ve cracked something fundamental.
Why the growth? The Infrastructure Investment and Jobs Act made it abundantly clear that the federal government is committed to EV charging. They’re talking about $7.5 billion in federal funding. There’s a new mandate for charging networks along highways. And here’s the part that makes Maurice’s tail twitch with excitement: the tailwinds are just beginning. We’re not at the peak of this wave. We’re still in the early morning, watching the swell build.
Now, let me be honest with you because that’s the only way I know how to operate. This is not a stock that’s going to appeal to Big Bear or his blue-chip crowd. EVgo is currently unprofitable. They’re bleeding cash—negative $117 million in free cash flow. Their debt-to-equity ratio is 80.6, which is about as unhealthy as it sounds. They’re trading at $1.875, well below both their 50-day and 200-day moving averages. Wall Street is nervous. Some analysts are straight-up telling people to avoid this stock.
And you know what? Those fears aren’t baseless. This is a risky position. This is the kind of stock that could crater if the EV adoption timeline slows down, if interest rates stay elevated, or if management fumbles the execution. The short ratio is sitting at 8.6, which means the bears have serious conviction against this one.
But here’s where I start throwing more bananas—and thinking about timing.
The critical concept you need to understand is “network scale economics.” Imagine you’re starting a charging network. Your first 20 stations lose money because they’re underutilized. Your second 50 stations still struggle because you’re spread too thin. But then something magical happens: you hit a critical density threshold where drivers choose your network because your stations are everywhere, and suddenly your utilization rates spike, your margins compress upward, and the unit economics flip from terrible to magnificent.
EVgo is approaching that inflection point. They’re already operating over 2,000 fast chargers and continue to expand aggressively. The revenue growth tells us the demand is there—they’re not manufacturing demand, they’re chasing it. What they need now is for utilization to improve as the network becomes denser and more indispensable to EV drivers. That’s the margin expansion catalyst that Foxy mentioned, and it’s credible.
The valuation story is interesting too. The stock is trading at $1.875. Foxy’s entry recommendation was $2.99 (we’re actually cheaper than that now), with a target of $5.50. UBS has a similar target at $5.50. That’s roughly 2.9x from current prices in about a year’s timeframe. Is it possible? Absolutely. Not guaranteed, but genuinely possible if they can show that:
One: Utilization rates are climbing (evidence that network density is working).
Two: Revenue per station is improving (evidence that pricing power exists when demand is desperate).
Three: They’re making progress toward profitability or at least cash-flow breakeven (evidence that the business model works).
The risk factors are equally real, though. EV adoption could slow. Tesla is building out their own Supercharger network and opening it to other vehicles—which is good for drivers but creates competition. Interest rates could stay high, making debt refinancing painful for a company with a 80x debt-to-equity ratio. Management could execute poorly. Any of these scenarios could send the stock to $0.75 just as easily as it could go to $5.50.
This is not a “set it and forget it” play. This is not something you throw your retirement savings into. This is a calculated bet on infrastructure timing with a specific thesis: you believe the EV revolution is real, you believe dense charging networks become essential, you believe EVgo can reach profitability, and you believe the market will reward that transition.
What Maurice finds compelling is that the current price isn’t reflecting the possibility of that transition. The stock is being hammered by bears who focus on the bleeding cash and the debt load—and they’re not wrong to worry! But they’re discounting the possibility that a company with market-leading scale in a federally-mandated industry might actually become profitable when utilization improves. That’s not a fantasy. That’s a reasonable bull case.
The timing consideration is also worth noting. We’re below the 200-day moving average. The momentum is negative, which is why the entry point is attractive. If you believe the thesis, you’re not trying to catch a knife—you’re catching a stock that’s been beaten down to a price where the risk-reward is interesting.
Foxy’s confidence level is an 8, and I think that’s calibrated correctly. This isn’t a “slam dunk 10” situation. The execution risks are real. But it’s a well-reasoned thesis in an industry with genuine tailwinds, at a price that’s already reflected significant pessimism. That’s how asymmetric opportunities usually start.
Here’s my honest take: If you can afford to lose this money—and I mean truly afford it without disrupting your financial stability—and if you believe in the long-term transition to electric vehicles, EVgo at $1.87 is interesting. Not guaranteed. Interesting. The upside to $5.50 represents a reasonable opportunity. The downside risk is real but not catastrophic at this valuation.
Just don’t expect this to be smooth. This banana’s going to bruise before it ripens.
Trained Market Monkey 