Why ChargePoint Shares Plunged This Week
ChargePoint Holdings (NYSE: CHPT) shares have been on a roll lately. The stock has jumped nearly 25% over the past month. But shares of the electric vehicle (EV) charging network company would have been even higher if they hadn't dropped by 12.5% this week as of early Friday, according to data provided by S&P Global Market Intelligence.
Last month's rise in ChargePoint shares didn't come because of any good news from the company. The stock surged as many technology and growth stocks fell back in favor with investors as the market sensed the end of a rising interest rate cycle. The Federal Reserve held rates steady, keeping its benchmark lending rate between 5.25% and 5.50%.
More importantly, for unprofitable, growing companies like ChargePoint, the Fed also signaled that several rate cuts could come in 2024. That could save ChargePoint significant money if it needs to borrow it in the near future. That's a distinct possibility, too, considering that as of Oct. 31, it held under $400 million in cash and equivalents on its balance sheet.
Source Fool.com
