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Xpeng stock forecast: Analysts rate XPEV as a ‘strong buy,’ projecting a 28% rise

Xpeng stock forecast: Analysts rate XPEV as a ‘strong buy,' projecting a 28% rise
Jordan
Major
Updated: 13 Sep, 2021
3 mins read

XPeng Motors (NYSE: XPEV) was among the companies that took a hit after the Chinese government announced additional restrictions targeting a broader range of firms.

The Chinese electric-car maker’s stock is now selling at $40.75, down slightly on the opening day of the trading week but up 2.03% in the past five days.

Notably, the stock is trading above its 20 and 50-day simple moving averages, a well-regarded uptrend indicator among growth stock investors. Furthermore, a triangle breakthrough is in sight, and based on previous performance, the trading volume should resurge in tandem with the breakout, implying that some volatility for XPEV is imminent.

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

Despite the Chinese government crackdown, the EV industry appears to have strong backing from the Chinese government, according to Edison Yu of Deutsche Bank.

Yu stated:

“We see continued strong government support both at central and local level due to the creation of manufacturing jobs, the promotion of a cleaner environment, and the desire to export to foreign markets. Ultimately, the government is striving to be a global leader in EV technology across the entire value chain.”

Indeed, Yu cites the rising opportunity in Chinese EV equities – emerging as “one of the most reliable/safe secular growth sectors” – as one of the reasons why XPEV shares merit a new price target.

Wall Street analysts’ predictions

Over the last three months, 5 Wall Street analysts, including Yu, projected Xpengs 12-month price. The average price forecast is $52.50, with a top of $57 and a low of $50. The average price estimate implies a 28.83% upside from the most recent price of $40.75.

Analyst price target on XPEV. Source: TipRanks.com

Analysts regard Xpeng as a buying opportunity at its current price since the average price forecast is up 28.83% from the most recent price of $40.75. 

Moreover, the five Wall Street analysts who have given Xpeng stock ratings in the previous three months suggest ‘Buy,’ while none urge ‘Hold,’ or ‘Sell.’ The consensus rating for Xpeng stock is a ‘strong buy ‘according to their recommendations.

EV market

It is worth noting that between Q2 2020 and Q2 2021, demand for new passenger battery electric (all-electric) cars in Europe grew 231.58%, going from 63,422 to 210,298. According to our figures, the demand for all-electric vehicles has tripled for the period.

Moreover, taking into account the Return On Investment (ROI) in percent, Xpeng has grown 75.47% between June 22, 2020, and June 22, 2021, and while it has not surpassed all competing companies in the sector, it is still in the top six in terms of ROI.

Also, the XPeng P7 vehicle received a 5-star safety rating with a total score of 89.4% and the highest active safety score of 98.51% among electric cars in China, according to the latest China New Car Assessment Program (C-NCAP) safety test findings on Monday, July 26.

Earlier this month, the EV firm also completed its Hong Kong main offering, raising nearly 13 billion RMB ($2 billion).

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Jordan Major
Author

Jordan is an investor and market analyst. He's passionate about stocks, ETFs, blockchain, and digital assets. At Finbold.com, he delves into the technicalities to obtain future trends for new market traders and gives insights into user-friendly platforms for beginners.