XPeng, Inc. (NYSE: XPEV) stock has had a great run since June after trading most of the year flat. Can it go higher? Or will it drop back to yearly lows?
Wall Street analysts see minimal gains within the next 12 months.
The average analyst target price sees a 6% gain
Analyst consensus at TipRanks is a ‘moderate buy’ for the XPEV stock based on 14 analysts in the last three months. Their average price target is $16.89, which is almost 6% higher than the current price of $15.94.
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Bank of America Securities analyst Ming Hsun Lee upgraded the XPeng stock to Buy from Hold on Monday, August 21, with a price target of $22 from $16.30 a share. The reason for the upgrade is the $700 million investment by Volkswagen, announced in July, that will improve the company’s finances, Lee writes. He expects XPeng to produce profits and positive free cash flow in 2025 as the two XPeng and Volkswagen develop EVs together.
So far, only Tesla and Li Auto are the only pure-play EV makers that generate free cash flow. With this investment, XPeng may join the club soon.
XPeng mentioned in its Q2 earnings that it expects to deliver between 39,000 and 41,000 vehicles in Q3, an increase of between 32% and 39% year-over-year. The company needs such growth for the price to beat analysts’ targets.
XPeng stock technical analysis
The stock price has been trading in a tight channel of between $8.50 and $11.40 from the beginning of the year until late June. The catalyst for the price break out, which caused XPEV to make a yearly high of $23.60, was the Volkswagen investment news.
XPeng’s stock price has been dropping since then, but the trendline successfully held the price above $15, which is the new support level for now. A break of this level puts downward pressure on the stock, with a target of $11.40 in the coming weeks.
If the price holds above $15, however, we could see another attempt at $20 and perhaps at $23.60, the recent high.
XPEV has already outperformed the S&P 500’s 15% return year-to-date, with a 56% gain during the same period.
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