Macquarie raised its price target on Chinese carmaker XPeng on Friday while keeping the ‘Outperform’ rating on the stock.
The new price target came hours after the company announced it is extending its partnership with the Volkswagen Group to integrate its E/E Architecture also across its Internal Combustion Engine (ICE) and Plug-in Hybrid Electric Vehicle (PHEV) platforms in China.
In a new research note, analyst Eugene Hsiao increased the target to $25 from $24 while maintaining an ‘Outperform’ rating on the stock.
“Q1’s net loss beat — partly due to other gains (subsidies, FX) — sets up a potential QoQ decline despite solid volume and margin growth,” Hsiao wrote.
“We are more focused on vehicle margin expansion, though recent peer beats on FX gains could suggest some non-operating upside surprise,” the analyst added.
Macquarie said it updated its estimates and rolled forward its valuation to fiscal year 2026, applying a 1.5x price-to-sales multiple.
This lifted its target price to HK$99 in Hong Kong and $25 in New York, implying an upside potential of 29%. XPeng shares closed 1.7% higher on Friday at $19.72.
The company will report its second quarter earnings results next week, on August 19.
The Guangzhou-based automaker registered 7,900 vehicles between August 4 and 10, according to industry data released earlier this week, down 13.2% from the 9,100 sold in the crossover week spanning late July and early August.
Data from the China Passenger Car Association showed on Monday that the Mona M03 sedan — sold only in China — accounted for nearly 43% of the company’s global deliveries in July.
