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ABB Expands E-mobility Charging Infrastructure in Germany

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ABB Ltd (ABB - Free Report) recently announced that it has secured an order from energy supplier EnBW to extend the charging column network on German motorways. However, the financial details of the deal were kept under wraps. Notably, the modern generation of charging columns is connected to the Internet through a cloud solution that facilitates cashless payments. The company is also expected to deliver an extra 117 rapid-charging columns at the locations of service station operator Tank & Rast by the end of the year.

The Deal

Per the order, ABB will install the fast-charging stations in cooperation with EnBW that will have a charging capacity of 50 kilowatts (kW), making them appropriate for service stations, highway rest stops, business locations and car dealerships. Last year, the company had clinched a deal from EnBW for 68 such rapid-charging stations with a high-charging capacity of 50 kW. The recent contract is an extension of this work which will enable the company to expand its electric mobility fast charging infrastructure in Germany.

Long-Term Prospects

As a matter of fact, ABB anticipates gaining from high investments in ultra high voltage DC power transmission projects in mature and emerging markets as well as continuing investments in maintenance of aging electric infrastructures. Positive development in the electricity value chain, rapid progress of Internet of Things Services and People (IoTSP), rapid urbanization and a surge in energy-efficient transport & infrastructure bode well for the company in the long term.

Year to date, the Zacks Rank #3 (Hold) company’s shares returned 16.8%, outperforming the industry’s average gain of 13.2%. Considered one of the best-managed industrial infrastructure, power and automation companies in the world, ABB stands to benefit from investments made to reduce energy intensity across all end-markets. At the end of third-quarter 2016, ABB launched the third stage of the revamped version of its “Next Level Strategy”. This is expected to unlock its full digital potential, increasing momentum in operational excellence and boosting the company’s brand.

Headwind

However, ABB’s exposure to oil and gas markets makes it susceptible to current price volatility in the market. The company’s order level in certain business segments has been hurt in recent times due on weak oil and gas demand. Further, lower capital spending for the company’s key upstream energy end-markets is likely to hurt financials.

Stocks to Consider

Some better-ranked stocks from the same space include Casella Waste Systems, Inc. (CWST - Free Report) , Barnes Group, Inc. (B - Free Report) and Allegion PLC (ALLE - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Casella Waste Systems has surpassed estimates in the trailing four quarters, with an average positive earnings surprise of 152.5%.

Barnes Group has outpaced estimates in the preceding four quarters, with an average earnings surprise of 11.7%.

Allegion has surpassed estimates twice in the trailing four quarters, with an average positive earnings surprise of 2.0%.

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