Beam Global (BEEM) stock forms a bullish pattern but risks remain

Beam Global (NASDAQ: BEEM) stock price jumped by over 8% on Thursday after the company received an order for its Beam AllCell by a leading solar-powered refrigerated trailer company. The stock has bounced back to $7.66, its highest point since February and is up by over 67% from its lowest point this year.

Beam Global receives an order

Beam Global is a technology company that provides solutions in the electric vehicle industry. It offers a patented EV ARC 2020, which is the only renewable, transportable, and off-grid charging solution. 

It also offers custom batteries that are used in the aviation, marine, industrial, and ground mobility solutions. Also, the company offers the ARC Mobility Trailer that helps companies and other users charge their vehicles in all conditions.

Beam Global stock jumped after the company announced a new order for its energy storage solution. The company was not named in the press release. In a statement, Beam Global’s CEO said:

“Beam AllCell energy storage solutions are the ideal choice for the superior performance that our customers demand and we intend to continue to uncover new opportunities to grow our revenues through the increasing electrification of all aspects of transportation.”

Beam Global has faced challenges

The recent BEEM stock recovery still leaves the company sharply lower than where it was trading in 2021. At its peak in 2021, the company was trading at $75.77 and has now dropped to $7.6. 

This decline has seen its market valuation crash from over $705 million in 2021 to about $107 million. 

It has dropped in line with the performance of other companies in the EV charging industry. For example, Blink Charging stock price has nosedived from a record high of $64.34 in 2021 to $3.15 while EVGO has dropped from $24.28 to below $4. The same is true with other companies in the industry like ChargePoint.

Beam Global has dropped as concerns about its growth, profitability, and balance sheet continued. Its most recent results showed that its revenue rose by 12% in the last quarter to $14.6 million. It ended the quarter with a backlog of $20 million and has a pipeline of $160 million. 

The company has gained several orders from the US Army, Department of Homeland Security, and the North Carolina Department of Adult Correction. Most importantly, it has received orders from other countries. 

A key challenge for Beam Global is that its balance sheet is a bit strained. It ended the last quarter with $5 million in cash, down from $10.4 million in the previous quarter. 

Therefore, there is a likelihood that it will continue diluting its shareholders. The number of outstanding shares has risen, because of its cash raises and stock-based compensation. Its outstanding shares have jumped from over 5.14 million in 2020 to over 14.3 million today. 

Dilution affects a company’s stock by increasing those in circulation and reducing its earnings per share (EPS). It is also making substantial losses.

Beam Global stock price analysis

BEEM chart by TradingView

The weekly chart shows that the BEEM share price peaked at $75.97 in 2021 to below $10 today. It has constantly remained below the 50-week and 25-week Exponential Moving Averages (EMA).

On the positive side, the stock has formed a falling wedge pattern, which is a popular bullish sign. It has now moved slightly above the upper side of this pattern, meaning that it could have some gains in the coming weeks.

If this rebound happens, there is a likelihood that the stock will bounce back to the psychological level at $10. The next potential catalyst to watch will be its earnings, which are set for August 12th.

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