Title: Updates on Xpeng Stock: An In-Depth Look
Title: Updates on Xpeng Stock: An In-Depth Look
Xpeng, the Chinese luxury electric vehicle (EV) manufacturer, reported a impressive increase in deliveries for December, reaching 36,695 units, a 82% year-over-year growth and a 19% increase month-over-month. The company also achieved a full-year delivery total of 190,068 units in 2024, a 34% increase compared to 2023.
Companies like Nio and Li Auto also reported strong delivery numbers, with Nio delivering 31,138 vehicles and Li Auto delivering 58,513 vehicles in December 2024 respectively. However, Xpeng's growth seems to be driven by its new sub-brand, Mona, and its affordable model Mona M03, which sold over 15,000 units in December. The XPENG P7+ sedan also saw strong demand, with sales exceeding 10,000 units in December.
Despite Xpeng stock's lackluster growth over recent years, the Trefis High Quality Portfolio, a collection of 30 stocks, has provided better returns with less risk versus the benchmark S&P 500 index over the last four year period. The current uncertain macroeconomic environment, with potential rate cuts and multiple wars, might lead to uncertainty for Xpeng's performance.
Xpeng's stock currently trades at roughly 2.6x estimated 2024 revenues, which is ahead of its peers Nio and Li Auto, but still well below U.S.-based Tesla, which trades at about 13x estimated 2024 revenues. Xpeng's recent growth has been much stronger than its rivals.
The company is seen as a leader in the Chinese EV market when it comes to automation and assisted driving technology, with advanced systems that operate without relying on HD maps or expensive LiDAR sensors. Xpeng is also pursuing aggressive international expansion, aiming to enter over 60 countries by 2025.
Investing in Xpeng stock might be driven by these factors, as the company's focus on affordability and technology could make its autonomous driving systems more accessible and conducive to mass adoption. However, the competition in the EV market is intense, with companies like Nio, Tesla and domestic powerhouse BYD also making notable strides.
Xpeng's stock price has shown notable volatility, with a volatility figure of 0.69, indicating significant price movements both opportunities and risks. The company's recent performance has been commendable, with a year-to-date rise of 26.06% and a return of 49.05% over the past year, outperforming the Dow Jones Index. However, its journey to profitability remains elusive, with net margins at -33.82% and positive free cash flow unlikely until 2025.
In summary, Xpeng's future outlook is promising, driven by its technological advancements, strategic market expansion, and robust cash buffer. However, the intense competition in the Chinese EV market might impact its growth trajectory. The potential for a recovery, as indicated by the falling wedge pattern, suggests that XPEV stock could experience upward momentum in the future.
The XPENG valuation, based on its estimated 2024 revenues, currently stands at 2.6x, surpassing its competitors Nio and Li Auto but still below Tesla's valuation. Xpeng's revenue for December 2024, fueled by the success of models like the Mona M03 and XPENG P7+, reached an impressive 36,695 units, contributing to its total delivery count of 190,068 units for the full year.