HC Wainwright & Co analyst Amit Dayal initiated coverage on the shares of Charge Enterprises Inc (NASDAQ:CRGE) with a Buy rating and announced a price target of $4.5.

The analyst said the company has diversified its revenues through several strategic acquisitions. Charge’s lower-margin but positive cash flow telecommunications business should support faster-growing infrastructure segments in the near term.

Dayal writes the company’s solid execution in a challenging macro environment is being overlooked in the current market volatility. He expects Charge’s revenue to grow 52% Y/Y to $723 million.

The drop in the company’s stock, Dayal said, has been driven more by prevailing market weakness rather than operational execution as the company delivered 47% and 40% YoY revenue growth in 1Q22 and 2Q22, respectively.

The drop in the stocks has been driven more by prevailing market weakness rather than operational execution, as the company delivered 47% and 40% YoY revenue growth in 1Q22 and 2Q22, respectively.

Charge is differentiating itself through its service and deployment capabilities while remaining relatively agnostic to technology, hardware, or software offerings, the analyst added.

This model, Dayal believes, provides the company with the flexibility to keep pace with the evolving EV charging and telecommunication technology landscape without incurring heavy development expenses.

Government initiatives, including $7.5B in funding for EV charging infrastructure as part of the Infrastructure Bill passed in November 2021 and incentives included in the Inflation Reduction Act (IRA) passed in August 2022, for the purchase of electric vehicles are likely to benefit the company.

Dayal concluded that 5G-related infrastructure upgrades and the ability to leverage existing telecom customer relationships provide the company with a relatively unique market position.

Price Action: CRGE shares are trading lower by 5.72% at $1.90 on the last check Friday.