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Analysts bullish on XPeng stock amid strong earnings – Is XPEV ready to break out?

Dino
Kurbegovic
3 months ago
3 mins read

XPeng’s (NYSE: XPEV) share price went above the $50 mark in late November 2021 after it released better than expected Q3 2021 results. Since then, shares of XPEV have halved year-to-date in 2022 on fears of the stock delisting and expected lower earnings. 

The most recent quarterly results were reported on March 28th and the company beat estimates on both revenue and earnings per share (EPS). Revenue went up an amazing 200% year-over-year (YoY) hitting $1.3 billion. Notably, the company was not profitable for the quarter but that was also in line with expectations. 

The news of the company’s performance in the last quarter reverberated nicely in the markets and the stock price grew, however, it is still down over the last year. 

XPEV key metrics

During Q4 the company delivered 42,000 vehicles which equates to an annual run rate of 170,000 vehicles. For non-profitable growth companies, growth in production and delivery levels is very important, XPEV seems to have delivered on these metrics. 

For Q4 delivered increased by 220% (YoY), slightly better than the company’s revenue growth. The average sales price for the products declined but this is related to a product lineup shift to lower-priced models such as the P5 sedan. 

Chart and analysts’ predictions 

At end of 2021, the stock began its descent, trading in a continuous descending channel. More recently the stock is trading between the 20 and 50-day Simple Moving Averages waiting for a breakout above.  

In the last month, XPeng has traded between $18.01 – $31.56, a somewhat broad trading band; the stock has recently reached a high towards the upper end of this range.

XPEV 20-50-200 SMA lines chart. Source. Finviz.com data. See more stocks here.

As Finbold reported earlier the analysts give the stock a strong buy and nothing has changed since then. Pundits see the average price of the stock in the next 12 months at $46.62 a potential increase of 50.67% from the current price of $28.95.

Source: TipRanks

Electric vehicle (EV) producers have been the favorites of the markets for quite some time, where companies like Tesla (NASDAQ: TSLA) enjoy a cult-like following. XPEV produced good earnings in face of challenging geopolitical developments which shows the potential of the stock. 

Investors looking for an EV play can find lots to like in XPEV, however broader market developments need to be taken into consideration before investing. 

Seemingly the company is on a good growth trajectory, if that keeps up the stock price should change considerably given that prices have been consolidating lately and the volatility has been reduced.

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk. 

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Dino Kurbegovic
Author

Dino is an investor and technology enthusiast with years of experience in managing complex projects. At Finbold he covers stories on stocks, investing, micro and macroeconomic trends. Also, he’s also building a micro solar power plants in his hometown.

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