What Happened?

Shares of electric vehicle charging company EVgo (NASDAQ:EVGO) fell 27.9% in the morning session after it announced a secondary offering of nearly 23 million of its common stock by EVgo Holdings, an affiliate of LS Power Equity Partners. The company itself is not selling any shares in this offering and will not receive any proceeds from the sale.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy EVgo? Access our full analysis report here, it’s free.

What The Market Is Telling Us

EVgo’s shares are extremely volatile and have had 70 moves greater than 5% over the last year. But moves this big are rare even for EVgo and indicate this news significantly impacted the market’s perception of the business. 

The biggest move we wrote about over the last year was 2 months ago when the stock gained 8.1% on the news that UBS analyst William Grippin upgraded the stock from Neutral to Buy and raised the price target from $4 to $8.5. The new price target represents a potential 20% increase from where shares traded before the upgrade was announced. The analyst added, "A $1.1 billion Energy Department loan guarantee and lower odds that Republicans will sweep the November elections are de-risking the company's outlook."

EVgo is up 33.9% since the beginning of the year, but at $4.42 per share, it is still trading 50.6% below its 52-week high of $8.94 from October 2024. Investors who bought $1,000 worth of EVgo’s shares at the IPO in November 2020 would now be looking at an investment worth $450.21.

When a company has more cash than it knows what to do with, buying back its own shares can make a lot of sense–as long as the price is right. Luckily, we’ve found one, a low-priced stock that is gushing free cash flow AND buying back shares. Click here to claim your Special Free Report on a fallen angel growth story that is already recovering from a setback.