Investing.com -- EVgo (NASDAQ:EVGO) shares jumped 5.1% in pre-market trading on Thursday, buoyed by an upgrade from UBS.
The brokerage raised its rating for EVgo to “buy” from “neutral,” flagging increased confidence in the electric vehicle charging company’s growth trajectory.
UBS’s upgrade follows a major announcement by the Department of Energy last week, where EVgo secured a $1.05 billion conditional loan commitment.
This funding is expected to accelerate the deployment of EVgo's charging stalls beyond 2025, outpacing the company's current deployment rate.
UBS analysts noted that the DOE loan would allow EVgo to increase its annual stall deployments from the current pace of 800-900 units to over 1,500 per year.
This projected growth, coupled with expectations of reaching adjusted EBITDA breakeven by the second half of 2025, provided a robust foundation for UBS’s upgraded outlook.
Additionally, UBS increased its price target for EVgo shares from $4 to $8.50, reflecting a higher valuation as the company gains financial visibility.