XPeng’s Strong Growth Potential and Strategic Expansion Reinforce Buy Rating

In a report released today, Rachel Miu from DBS maintained a Buy rating on XPeng, Inc. Class A (9868 – Research Report), with a price target of HK$126.00.

Rachel Miu has given her Buy rating due to a combination of factors that highlight XPeng’s strong growth potential. The company’s first-quarter results exceeded expectations, with significant improvements in revenue and a substantial reduction in non-GAAP losses. This performance is supported by a robust product pipeline, including the introduction of new models like the G6, G9, X9, and Mona Max, which are expected to enhance the company’s sales outlook.
Additionally, XPeng’s expansion into international markets serves as a crucial growth catalyst, with plans to double overseas shipments in the fiscal year 2025. Despite a slight reduction in the price target due to the impact of EU tariffs, the company’s improving vehicle margins and the potential for profitability by the fourth quarter of 2025 reinforce the Buy rating. The stock’s valuation is attractive, trading at a forward 1.5x EV/sales, and the company’s strategic initiatives in technology and market expansion are expected to drive future profitability.

In another report released yesterday, Macquarie also upgraded the stock to a Buy with a HK$93.00 price target.