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On Wednesday, BofA Securities analyst Ming Hsun Lee increased the price target on XPeng stock (NYSE: NYSE:XPEV) to $29 from the previous $27, while reaffirming a Buy rating on the shares. Currently trading at $21.95, XPeng has seen its stock surge 124.5% over the past year. The adjustment follows the company’s first-quarter 2025 performance, which aligned with analyst expectations. According to InvestingPro, analysts maintain a bullish consensus with price targets ranging from $16.46 to $32.13.
XPeng, now commanding a market capitalization of $21 billion, achieved sales of RMB 16 billion during the first quarter, marking a 141% year-over-year increase but a 2% decline quarter-over-quarter. The gross profit margin (GPM) experienced a rise, reaching 15.6%, which was above the anticipated 15.1%. This increase in GPM by 2.7 percentage points year-over-year and 1.1 percentage points quarter-over-quarter was attributed to cost reductions and economies of scale.
The vehicle margin saw a significant improvement, reported at 10.5%, a 5.0 percentage point increase from the previous year and a 0.5 percentage point increase from the last quarter. This gain was partly due to reductions in cost and the benefits of scaling up production. However, it was slightly tempered by provisions for inventory and losses related to purchase commitments for upcoming model upgrades.
Operating expenses relative to sales decreased to 24.8%, showing a substantial year-over-year reduction of 17 percentage points and a 1.8 percentage point decrease from the previous quarter. The non-GAAP net loss for the quarter was RMB 426 million, which was an improvement over the RMB 517 million net loss projected by analysts. This better-than-expected outcome was influenced by non-operating items, including government subsidies and foreign exchange gains totaling RMB 544 million and RMB 130 million, respectively, and a RMB 118 million fair value loss due to contingent consideration. InvestingPro analysis reveals the company maintains a strong balance sheet with more cash than debt, while analysts project 97% revenue growth for the current fiscal year.
In other recent news, XPeng reported a significant improvement in its financial performance for the first quarter of 2025, with a reduced net loss of Rmb664 million, compared to Rmb1.3 billion in the previous quarter. The company’s revenue saw a year-over-year increase of 141%, reaching Rmb15.8 billion, driven by robust vehicle deliveries of 94,000 units. XPeng also launched a faster-charging variant of its P7+ sedan at the 2025 Shanghai auto show, featuring a battery that can be fully charged in just 12 minutes. This new model is positioned competitively in the market with a starting price of RMB 208,800 ($28,570).
Morgan Stanley (NYSE:MS) maintained an Overweight rating on XPeng, with a price target of $26.00, reflecting confidence in the company’s performance. April sales data showed strong demand for XPeng’s vehicles, with deliveries nearly tripling compared to the same period last year, totaling 35,045 units. Despite these positive developments, XPeng’s stock was affected by broader market trends, including an 11% decline due to escalating trade tensions between the U.S. and China. In the European market, XPeng experienced growth, although the overall share of Chinese EVs in the region decreased. These recent developments highlight XPeng’s efforts to innovate and expand its market presence amidst a dynamic global environment.
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