XPeng’s (XPEV) co-founder and CEO, Xiaopeng He, has solidified his stake in the Chinese smart electric vehicle (EV) maker by purchasing more than two million shares in the last week. The news pushed XPeng’s Hong Kong-listed shares (HK:9868) up by 7% today. At the same time, XPEV’s U.S.-listed shares were up 5.9% in Monday’s pre-market trading, as of writing.
XPeng’s CEO Ups His Stake
XPeng’s CEO purchased 1 million of the company’s Class A ordinary shares directly. Furthermore, he bought 1.42 million of XPeng’s ADSs (American Depositary Shares) through a wholly-owned subsidiary, Galaxy Dynasty. The latest purchase brings his total ownership up to roughly 18.8%.
According to a regulatory filing dated August 26, the CEO made multiple purchases of the shares between August 21 and August 23 for roughly $13.5 million. He purchased the Class A ordinary shares for an average price of HK$27.13 apiece, while the ADSs were purchased at an average price of $7.02 per ADS.
His recent purchase displays a sign of confidence in the company’s future in the face of increased competition and reduced consumer buying power. The CEO stated that he intends to further increase his stake in compliance with regulatory requirements.
Nomura Analyst Comments on CEO Stake Boost
In response to the CEO’s stake boost, Nomura analyst Joel Ying noted that his purchase demonstrates confidence in the launch of XPeng’s two new models. XPeng is slated to launch the MONA MO3, an all-electric intelligent hatchback coupe, at the 10th Anniversary Gala Night on August 27. Moreover, the P7+ sedan is scheduled for launch in the fourth quarter of this year.
The P7+ is expected to give stiff competition to American EV maker Tesla (TSLA) as it boasts a vision advanced driver-assistance system that is comparable to the latter’s FSD (full-service driving) system. Ying believes that both these models could boost XPeng’s deliveries and become major sales drivers for the remainder of the year.
Is XPENG a Buy, Sell, or Hold Stock?
On TipRanks, XPEV stock has a Moderate Buy consensus rating based on seven Buys, two Holds, and one Sell rating. Also, the average XPeng price target of $11.55 implies 64.8% upside potential from current levels. Meanwhile, XPEV shares have declined 51.9% year-to-date.
