Written by Cláudio Afonso | LinkedIn | X
UBS analyst Paul Gong published on Friday a new research note on the EV maker XPeng downgrading the rating of the U.S.-listed shares from Neutral to Sell despite raising the price target slightly to $8.80 from $8.20.
Following the successful launch and production ramp up of XPeng’s two new models, its stock has surged 54% over the past three months, trading at approximately $12.45 per share, nearly double its 2024 low of $6.55 reached in April.
In a research note, Gong cautioned that XPeng’s recent rally may have overextended its valuation. “We believe the upside is more than priced in,” he wrote, adding that investors should be aware of potential downside risks that are not yet reflected in the stock’s current price.
“XPeng’s share price has risen over 50% since September as newly launched MONA M03 and P7+ reported higher-than-expected initial order intakes and monthly deliveries. While we share the market’s excitement for XPeng’s new EV momentum and fast cost optimization, we believe the upside is more than priced in and caution investors against downside risks not yet priced in,” the analyst wrote.
Despite the rating downgrade, Gong raised the price target by 60c to $8.20 representing a downside of nearly 30%.
“We lift PT to US$8.80 from US$8.20, still based on 1.0x 2025E P/S, and raise 2025E volumes by 19% to 300k units. Given our PT [price target] is >30% below the current market price, we downgrade XPeng from Neutral to Sell,” UBS analyst noted.
Globally, the XPeng delivered 30,895 vehicles in November, marking the first time it has surpassed the 30,000 threshold in its decade-long history and setting a record for the third consecutive month. Deliveries in November increased 29% from 23,917 units in October and surged 54% year-on-year.
As reported earlier this Friday, XPeng registered 81 vehicles in Germany in November, marking its second-best monthly performance since entering the market in May. However, registrations declined sequentially from 100 units recorded in October.
Written by Cláudio Afonso | LinkedIn | X
