EVgo’s DOE Loan of $1.25Billion closes with a “Holiday Gift” for Investors

What you need to know

• EVgo recently announced the closing of a 1,25 billion dollar loan with Department of Energy in order to expand its EV charging station network.
• The money will be used to purchase 7,500 chargers in the United States over the next 5 years.
• EVgo warned that its "business will be materially and adversely affected" if it fails to meet the conditions of the loan.

EVgo shares (EVGO) went through a wild ride on Friday following the announcement that the maker of electric vehicle chargers had received a loan guarantee from the federal Government for $1,25 billion to expand its charging stations. 

The U.S. Department of Energy Loan Programs Office announced that Title 17 Clean Energy Financing Program, the U.S. Department of Energy’s loan program for clean energy financing programs had ended.

EVgo stated that it would use the money to construct at least 7,500 charging stations across its network. Installing the chargers over five years will begin next year. 

J.P. Morgan referred to the closing of loans in a client note “an early holiday gift” Investors can get in touch with EVgo. Analysts maintained their opinions. “overweight” Rating was upgraded in October, anticipating that the loan would be closed before 2024. The added that they “expect the company to remain laser-focused on execution, with positive catalysts from here likely levered to operational milestones and near-term results.”

EVgo CEO Badar K Khan stated that the agreement with Energy Department was reached by EVgo. “will help us continue to scale our operations to serve the influx of vehicle options that will be available to American consumers in the coming years.”

The initial news sent EVgo’s shares soaring. However, they fell the next morning due to concerns raised by the company after it stated that if the loan guarantee conditions were not met, then the firm would terminate the guarantees. “materially and adversely affect our business.” The afternoon saw a bounce back before they slipped into the negative zone again.

Stocks were down by 2% a half-hour before closing. EVgo has gained around 70% in value since 2024.

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