XPeng’s G7 Launch and AI Innovations Drive Buy Rating Amid Strong Sales Momentum

Analyst Tim Hsiao from Morgan Stanley maintained a Buy rating on XPeng, Inc. ADR (XPEV – Research Report) and increased the price target to $28.00 from $26.00.

Tim Hsiao has given his Buy rating due to a combination of factors including the promising launch of XPeng’s G7 model, which features advanced technology like the Huawei co-developed AR-HUD and AI Turing smart driving chips. These innovations are expected to enhance the vehicle’s appeal and drive significant sales volumes, with projections of 6-8k units monthly at a steady state. The G7’s AI Turing chip, in particular, offers superior computing power and enables L3 autonomous driving features, setting it apart from competitors.
Additionally, despite potential short-term stock volatility due to recent price increases, the strong pre-sale orders for the G7 and positive channel feedback suggest a solid sales momentum. This has led to an upward revision in XPeng’s volume forecasts and an expectation of net profit breakeven by 2026. These factors, along with the strategic AI-related initiatives, underpin Tim Hsiao’s optimistic outlook and Buy rating for XPeng’s stock.

In another report released on May 28, Citi also maintained a Buy rating on the stock with a $29.00 price target.