XPeng: Not Good Enough Yet To Buy

seekingalpha12-10

SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle ...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

JediGingerNinja
12-10
JediGingerNinja
This is dajavu. You where saying the same thing when tesla reduced it's margins. I did buy XPeng before you wrote this article and there has been a 6% drop but let's see how we look in a few weeks.
Bobet
12-10
Bobet
$NIO Inc.(NIO)$ is way must better than$XPeng Inc.(XPEV)$ yet the share price is higher than Nio. it's not too late to switch or buy$NIO Inc.(NIO)$ share while it's below $5 mark hahaha
zlance
12-10
zlance
The analysis on Xpeng seems too focused on margins, which might not be the best benchmark at this stage of its growth. The priority should be on delivery volumes, as every car not sold strengthens competitors instead. High delivery numbers also enhance brand visibility and consumer awareness, crucial in competitive markets like Southeast Asia and Europe. Xpeng is strategically positioned in these regions, targeting emerging and EV-friendly markets. Focusing on deliveries will build scale and consumer trust, paving the way for improved margins later. Margins are a lagging indicator in this context; volume is the key driver for long-term success.
- gogoooCn:
  Always believe in Chinese EVs

Leave a comment

{"i18n":{"language":"en_US"},"isChannel":false,"data":{"share":"https://ttm.financial/m/news/1196359058?lang=en_US&edition=fundamental","thumbnail":"","is_english":true,"pubTime":"2024-12-10 16:48","share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","id":"1196359058","market":"us","top_or_hot":-1,"title":"XPeng: Not Good Enough Yet To Buy","media":"seekingalpha","content":"<div>\n<p>SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle ...</p>\n\n<a href=\"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy\">Source Link</a>\n\n</div>\n","source":"seekingalpha_hot_news","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>XPeng: Not Good Enough Yet To Buy</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nXPeng: Not Good Enough Yet To Buy\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-10 16:48 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle ...</p>\n\n<a href=\"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"09868","symbol_name":"小鹏汽车-W","start_time":0,"source_url":"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy","article_id":"1196359058","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=1196359058","pubTimestamp":1733820520,"columns":[],"sourceInfo":{"source_id":"seekingalpha_hot_news","name":"SeekingAlpha"},"weMediaInfo":null,"summary":"SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle mar","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"09868":"小鹏汽车-W","XPEV":"小鹏汽车"},"translate_title":"小鹏汽车：还不够好，不值得购买","themeId":"b81430a1f1f98267ea558e58a1623dc1","isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"09868":1.1,"XPEV":1.1},"content_text":"SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle margins to 8.6%, XPeng still lags behind Li Auto's 20.9% and NIO's 13.1% margins.XPeng's Q4 delivery guidance is strong, projecting 87,000 to 91,000 EVs, translating to up 51% year-over-year growth.I maintain a hold rating on XPeng stock due to its weaker margins and unjustified premium valuation compared to Li Auto and NIO.XPeng Motors StoreShares of XPeng (NYSE:XPEV) have dropped off lately, despite the EV maker reporting a sequential improvement in its vehicle margins and benefiting from higher delivery volumes due to the launch of new EV models such as the Mona M03 and the P7+. November deliveries were also encouraging, with XPeng managing to deliver more than 30,000 electric vehicles, a record for the EV firm. Deliveries for the EV maker have been in an upswing lately and the company also submitted a strong guidance for Q4 deliveries. XPeng is still lagging behind its EV rivals in terms of vehicle margins, however, which is why I am not yet prepared to upgrade my rating.ChartPrevious ratingI rated shares of XPeng a hold in my last work on the company -- Inferior EV Investment Choice -- because the electric vehicle company experienced pressure on its margins and experienced weak delivery growth earlier this year. Companies like Li Auto (LI) and NIO (NIO) offer significantly better investment propositions, in my opinion, due to their higher vehicle margins and stronger delivery growth. While XPeng’s delivery prospects are improving, in part because of the launch of the low-cost Mona M03 EV, I believe XPeng does not deserve to trade at a higher valuation than either Li Auto or NIO.XPeng’s deliveries are surging, but margin profile remains inferiorXPeng made considerable progress in the third fiscal quarter in terms of growing its vehicle margins, but the company is still lagging far behind the EV competition. XPeng generated vehicle margins of 8.6% in Q3'24, showing a 2.2 PP sequential margin gain. For context, Li Auto generated vehicle margins of 20.9% (+2.2 PP Q/Q) with which the EV maker is still leading the industry start-up group. NIO generated a vehicle margin of 13.1% for the third-quarter (+0.9 PP Q/Q).XPengIn terms of gross margins, Li Auto is also leading is also leading, although both NIO and XPeng have narrowed the gap lately. At the current moment, XPeng has the second-highest gross margins in the industry group at 15.3%. While Li Auto still has the highest gross margin of 21.5%, XPeng has the potential to catch up, mainly because of surging volume production which is driven by both the P7+ model as well as the Mona M03.ChartThe Mona M03 is an all-electric hatchback sedan that is seeing considerable growth momentum and is a key reason behind XPeng’s delivery surge lately. The P7+ is a battery-powered EV -- which is a mid to large-size electric sedan with a retail price starting at 186,800 Chinese Yuan (~$26k) -- and only started to be delivered to customers in October, so investors can expect a significant ramp here in the months ahead as well.In the third-quarter, the company delivered 46,533 electric vehicles, which showed a 16.3% year-over-year growth rate. In November, deliveries surged for the first time ever above the 30,000 monthly delivery threshold: in the month of November, XPeng delivered a total of 30,895 electric vehicles, showing 54% growth year-over-year. The Mona M03 was launched in August 2024 and just had its third consecutive month of 10k+ deliveries. XPeng launched the Mona M03 mainly in order to offer consumers a lower-cost alternative to Tesla's (TSLA) Model 3 which costs about twice as much.CNEVPOSTXPeng’s delivery guidance for Q4Due to the ramp in Mona M03 production and the recent launch of the P7+ electric vehicle, XPeng is benefiting from a considerable delivery boost that is expected to continue in Q4’24. According to XPeng’s Q3’24 earnings report, the EV firm expects to deliver a massive 87,000 to 91,000 EVs in the fourth fiscal quarter which translates to a Y/Y growth rate of between 45-51%.XPeng’s valuationDespite having weaker vehicle margins than the competition, XPeng has the highest valuation in the industry start-up group in terms of price-to-revenue ratio. Shares of XPeng are currently valued at a forward P/S ratio of 1.23X which is significantly above the valuation of Li Auto... which, due to superior execution (stronger growth, higher margins), would be deserving to lead the industry group in terms of valuation. That it does not was one reason why I called Li Auto a Best-Of-Breed EV Start-Up.In my last work on XPeng I arrived at a fair value of $9.50 per-share based off of an average industry group P/S ratio of 0.8X. The industry group average P/S ratio has since risen to 0.9X, so I would raise my fair value target here to $10 per-share. With shares currently trading at $12.50, I consider XPeng more than fully valued. I don't rate XPeng a sell, however, due to its impressive delivery trend and progress in terms of growing vehicle and gross margins.ChartRisks regarding XPengWhile XPeng is seeing a ton of interest for its Mona M03 hatchback sedan and deliveries are surging, the EV company is still lagging far behind its direct EV rivals Li Auto and NIO, both of which have stronger vehicle margins. Li Auto especially is crushing it in this regard. What would change my mind about XPeng, either to the positive or negative, would be a change in the vehicle margin trajectory. Further, a down-trend in margins would likely be a very serious valuation issue if a larger portion of deliveries is made up of lower-cost EVs going forward. In this sense, it remains to be seen in FY 2025 if XPeng can actually continue to grow its margins.Final thoughtsXPeng is currently crushing it in terms of deliveries, and the company delivered a healthy Q3 earnings scorecard. In November, the company's delivery growth surged, mainly due to growth momentum for the P7+ and the Mona M03 electric vehicles. While the delivery surge as well as the outlook for Q4 deliveries are positive, I still feel a little bit uncomfortable with XPeng’s margin profile… which I continue to see as inferior to those of either Li Auto or NIO. Further, I don’t see XPeng’s valuation premium with regard to other EV start-up companies as justified, especially because Li Auto and NIO are offering strong vehicle and gross margins themselves. For those reasons, I am going to continue to rate XPeng only a hold.","kind":"news","is_publish_news":true,"is_publish_highlight":true,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[{"id":380077421941048,"gmtCreate":1733828908465,"gmtModify":1733828912459,"author":{"id":"4126558027897282","authorId":"4126558027897282","name":"JediGingerNinja","avatar":"https://community-static.tradeup.com/news/9fec3f291b238bacf1a948fd098d3042","vip":1,"hat":"https://static.tigerbbs.com/4c5ceab71416b120bab4604c0754b52a","crmLevel":1,"crmLevelSwitch":0,"idStr":"4126558027897282","authorIdStr":"4126558027897282"},"htmlText":"This is dajavu. You where saying the same thing when tesla reduced it's margins. I did buy XPeng before you wrote this article and there has been a 6% drop but let's see how we look in a few weeks.&nbsp;","listText":"This is dajavu. You where saying the same thing when tesla reduced it's margins. I did buy XPeng before you wrote this article and there has been a 6% drop but let's see how we look in a few weeks.&nbsp;","text":"This is dajavu. You where saying the same thing when tesla reduced it's margins. I did buy XPeng before you wrote this article and there has been a 6% drop but let's see how we look in a few weeks.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/380077421941048","repostId":1196359058,"repostType":2,"repost":{"id":"1196359058","kind":"news","pubTimestamp":1733820520,"share":"https://ttm.financial/m/news/1196359058?lang=&edition=fundamental","pubTime":"2024-12-10 16:48","market":"us","language":"en","title":"XPeng: Not Good Enough Yet To Buy","url":"https://stock-news.laohu8.com/highlight/detail?id=1196359058","media":"seekingalpha","summary":"SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle mar","content":"<html><head></head><body><h2 id=\"id_365374367\">Summary</h2><ul style=\"\"><li><p>XPeng&#39;s deliveries are surging, driven by the Mona M03 and P7+ models, but the company&#39;s vehicle margins are still below those of Li Auto and NIO.</p></li><li><p>Despite a sequential improvement in vehicle margins to 8.6%, XPeng still lags behind Li Auto&#39;s 20.9% and NIO&#39;s 13.1% margins.</p></li><li><p>XPeng&#39;s Q4 delivery guidance is strong, projecting 87,000 to 91,000 EVs, translating to up 51% year-over-year growth.</p></li><li><p>I maintain a hold rating on XPeng stock due to its weaker margins and unjustified premium valuation compared to Li Auto and NIO.</p></li></ul><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/61c61dfda4c0f95b70cd0879cfcbe495\" alt=\"XPeng Motors Store\" title=\"XPeng Motors Store\" tg-width=\"750\" tg-height=\"500\"/><span>XPeng Motors Store</span></p><p></p><p>Shares of XPeng (NYSE:XPEV) have dropped off lately, despite the EV maker reporting a sequential improvement in its vehicle margins and benefiting from higher delivery volumes due to the launch of new EV models such as the Mona M03 and the P7+. November deliveries were also encouraging, with XPeng managing to deliver more than 30,000 electric vehicles, a record for the EV firm. Deliveries for the EV maker have been in an upswing lately and the company also submitted a strong guidance for Q4 deliveries. XPeng is still lagging behind its EV rivals in terms of vehicle margins, however, which is why I am not yet prepared to upgrade my rating.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ba8a22e89d76cc247498bcccd44599ef\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"424\"/><span>Chart</span></p><p></p><h2 id=\"id_3219377826\">Previous rating</h2><p>I rated shares of XPeng a hold in my last work on the company -- Inferior EV Investment Choice -- because the electric vehicle company experienced pressure on its margins and experienced weak delivery growth earlier this year. Companies like Li Auto (LI) and NIO (NIO) offer significantly better investment propositions, in my opinion, due to their higher vehicle margins and stronger delivery growth. While XPeng’s delivery prospects are improving, in part because of the launch of the low-cost Mona M03 EV, I believe XPeng does not deserve to trade at a higher valuation than either Li Auto or NIO.</p><h2 id=\"id_2518852215\">XPeng’s deliveries are surging, but margin profile remains inferior</h2><p>XPeng made considerable progress in the third fiscal quarter in terms of growing its vehicle margins, but the company is still lagging far behind the EV competition. XPeng generated vehicle margins of 8.6% in Q3&#39;24, showing a 2.2 PP sequential margin gain. For context, Li Auto generated vehicle margins of 20.9% (+2.2 PP Q/Q) with which the EV maker is still leading the industry start-up group. NIO generated a vehicle margin of 13.1% for the third-quarter (+0.9 PP Q/Q).</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/da35a0b394d7a77d8f6e2bd62cf9c734\" alt=\"XPeng\" title=\"XPeng\" tg-width=\"640\" tg-height=\"279\"/><span>XPeng</span></p><p></p><p>In terms of gross margins, Li Auto is also leading is also leading, although both NIO and XPeng have narrowed the gap lately. At the current moment, XPeng has the second-highest gross margins in the industry group at 15.3%. While Li Auto still has the highest gross margin of 21.5%, XPeng has the potential to catch up, mainly because of surging volume production which is driven by both the P7+ model as well as the Mona M03.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/57b1dc8291cd6665e3d12198f676a8ed\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"559\"/><span>Chart</span></p><p></p><p>The Mona M03 is an all-electric hatchback sedan that is seeing considerable growth momentum and is a key reason behind XPeng’s delivery surge lately. The P7+ is a battery-powered EV -- which is a mid to large-size electric sedan with a retail price starting at 186,800 Chinese Yuan (~$26k) -- and only started to be delivered to customers in October, so investors can expect a significant ramp here in the months ahead as well.</p><p>In the third-quarter, the company delivered 46,533 electric vehicles, which showed a 16.3% year-over-year growth rate. In November, deliveries surged for the first time ever above the 30,000 monthly delivery threshold: in the month of November, XPeng delivered a total of 30,895 electric vehicles, showing 54% growth year-over-year. The Mona M03 was launched in August 2024 and just had its third consecutive month of 10k+ deliveries. XPeng launched the Mona M03 mainly in order to offer consumers a lower-cost alternative to Tesla&#39;s (TSLA) Model 3 which costs about twice as much.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/846c0d2608a16e0de9cc93526e082c59\" alt=\"CNEVPOST\" title=\"CNEVPOST\" tg-width=\"640\" tg-height=\"335\"/><span>CNEVPOST</span></p><p></p><h2 id=\"id_492501609\">XPeng’s delivery guidance for Q4</h2><p>Due to the ramp in Mona M03 production and the recent launch of the P7+ electric vehicle, XPeng is benefiting from a considerable delivery boost that is expected to continue in Q4’24. According to XPeng’s Q3’24 earnings report, the EV firm expects to deliver a massive 87,000 to 91,000 EVs in the fourth fiscal quarter which translates to a Y/Y growth rate of between 45-51%.</p><h2 id=\"id_3019503728\">XPeng’s valuation</h2><p>Despite having weaker vehicle margins than the competition, XPeng has the highest valuation in the industry start-up group in terms of price-to-revenue ratio. Shares of XPeng are currently valued at a forward P/S ratio of 1.23X which is significantly above the valuation of Li Auto... which, due to superior execution (stronger growth, higher margins), would be deserving to lead the industry group in terms of valuation. That it does not was one reason why I called Li Auto a Best-Of-Breed EV Start-Up.</p><p>In my last work on XPeng I arrived at a fair value of $9.50 per-share based off of an average industry group P/S ratio of 0.8X. The industry group average P/S ratio has since risen to 0.9X, so I would raise my fair value target here to $10 per-share. With shares currently trading at $12.50, I consider XPeng more than fully valued. I don&#39;t rate XPeng a sell, however, due to its impressive delivery trend and progress in terms of growing vehicle and gross margins.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/beeb2f8a496fe70e844bf943b9b2519a\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"559\"/><span>Chart</span></p><p></p><h2 id=\"id_3781645470\">Risks regarding XPeng</h2><p>While XPeng is seeing a ton of interest for its Mona M03 hatchback sedan and deliveries are surging, the EV company is still lagging far behind its direct EV rivals Li Auto and NIO, both of which have stronger vehicle margins. Li Auto especially is crushing it in this regard. What would change my mind about XPeng, either to the positive or negative, would be a change in the vehicle margin trajectory. Further, a down-trend in margins would likely be a very serious valuation issue if a larger portion of deliveries is made up of lower-cost EVs going forward. In this sense, it remains to be seen in FY 2025 if XPeng can actually continue to grow its margins.</p><h2 id=\"id_4117769550\">Final thoughts</h2><p>XPeng is currently crushing it in terms of deliveries, and the company delivered a healthy Q3 earnings scorecard. In November, the company&#39;s delivery growth surged, mainly due to growth momentum for the P7+ and the Mona M03 electric vehicles. While the delivery surge as well as the outlook for Q4 deliveries are positive, I still feel a little bit uncomfortable with XPeng’s margin profile… which I continue to see as inferior to those of either Li Auto or NIO. Further, I don’t see XPeng’s valuation premium with regard to other EV start-up companies as justified, especially because Li Auto and NIO are offering strong vehicle and gross margins themselves. For those reasons, I am going to continue to rate XPeng only a hold.</p></body></html>","source":"seekingalpha_hot_news","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>XPeng: Not Good Enough Yet To Buy</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nXPeng: Not Good Enough Yet To Buy\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-10 16:48 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle ...</p>\n\n<a href=\"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09868":"小鹏汽车-W","XPEV":"小鹏汽车"},"source_url":"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1196359058","content_text":"SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle margins to 8.6%, XPeng still lags behind Li Auto's 20.9% and NIO's 13.1% margins.XPeng's Q4 delivery guidance is strong, projecting 87,000 to 91,000 EVs, translating to up 51% year-over-year growth.I maintain a hold rating on XPeng stock due to its weaker margins and unjustified premium valuation compared to Li Auto and NIO.XPeng Motors StoreShares of XPeng (NYSE:XPEV) have dropped off lately, despite the EV maker reporting a sequential improvement in its vehicle margins and benefiting from higher delivery volumes due to the launch of new EV models such as the Mona M03 and the P7+. November deliveries were also encouraging, with XPeng managing to deliver more than 30,000 electric vehicles, a record for the EV firm. Deliveries for the EV maker have been in an upswing lately and the company also submitted a strong guidance for Q4 deliveries. XPeng is still lagging behind its EV rivals in terms of vehicle margins, however, which is why I am not yet prepared to upgrade my rating.ChartPrevious ratingI rated shares of XPeng a hold in my last work on the company -- Inferior EV Investment Choice -- because the electric vehicle company experienced pressure on its margins and experienced weak delivery growth earlier this year. Companies like Li Auto (LI) and NIO (NIO) offer significantly better investment propositions, in my opinion, due to their higher vehicle margins and stronger delivery growth. While XPeng’s delivery prospects are improving, in part because of the launch of the low-cost Mona M03 EV, I believe XPeng does not deserve to trade at a higher valuation than either Li Auto or NIO.XPeng’s deliveries are surging, but margin profile remains inferiorXPeng made considerable progress in the third fiscal quarter in terms of growing its vehicle margins, but the company is still lagging far behind the EV competition. XPeng generated vehicle margins of 8.6% in Q3'24, showing a 2.2 PP sequential margin gain. For context, Li Auto generated vehicle margins of 20.9% (+2.2 PP Q/Q) with which the EV maker is still leading the industry start-up group. NIO generated a vehicle margin of 13.1% for the third-quarter (+0.9 PP Q/Q).XPengIn terms of gross margins, Li Auto is also leading is also leading, although both NIO and XPeng have narrowed the gap lately. At the current moment, XPeng has the second-highest gross margins in the industry group at 15.3%. While Li Auto still has the highest gross margin of 21.5%, XPeng has the potential to catch up, mainly because of surging volume production which is driven by both the P7+ model as well as the Mona M03.ChartThe Mona M03 is an all-electric hatchback sedan that is seeing considerable growth momentum and is a key reason behind XPeng’s delivery surge lately. The P7+ is a battery-powered EV -- which is a mid to large-size electric sedan with a retail price starting at 186,800 Chinese Yuan (~$26k) -- and only started to be delivered to customers in October, so investors can expect a significant ramp here in the months ahead as well.In the third-quarter, the company delivered 46,533 electric vehicles, which showed a 16.3% year-over-year growth rate. In November, deliveries surged for the first time ever above the 30,000 monthly delivery threshold: in the month of November, XPeng delivered a total of 30,895 electric vehicles, showing 54% growth year-over-year. The Mona M03 was launched in August 2024 and just had its third consecutive month of 10k+ deliveries. XPeng launched the Mona M03 mainly in order to offer consumers a lower-cost alternative to Tesla's (TSLA) Model 3 which costs about twice as much.CNEVPOSTXPeng’s delivery guidance for Q4Due to the ramp in Mona M03 production and the recent launch of the P7+ electric vehicle, XPeng is benefiting from a considerable delivery boost that is expected to continue in Q4’24. According to XPeng’s Q3’24 earnings report, the EV firm expects to deliver a massive 87,000 to 91,000 EVs in the fourth fiscal quarter which translates to a Y/Y growth rate of between 45-51%.XPeng’s valuationDespite having weaker vehicle margins than the competition, XPeng has the highest valuation in the industry start-up group in terms of price-to-revenue ratio. Shares of XPeng are currently valued at a forward P/S ratio of 1.23X which is significantly above the valuation of Li Auto... which, due to superior execution (stronger growth, higher margins), would be deserving to lead the industry group in terms of valuation. That it does not was one reason why I called Li Auto a Best-Of-Breed EV Start-Up.In my last work on XPeng I arrived at a fair value of $9.50 per-share based off of an average industry group P/S ratio of 0.8X. The industry group average P/S ratio has since risen to 0.9X, so I would raise my fair value target here to $10 per-share. With shares currently trading at $12.50, I consider XPeng more than fully valued. I don't rate XPeng a sell, however, due to its impressive delivery trend and progress in terms of growing vehicle and gross margins.ChartRisks regarding XPengWhile XPeng is seeing a ton of interest for its Mona M03 hatchback sedan and deliveries are surging, the EV company is still lagging far behind its direct EV rivals Li Auto and NIO, both of which have stronger vehicle margins. Li Auto especially is crushing it in this regard. What would change my mind about XPeng, either to the positive or negative, would be a change in the vehicle margin trajectory. Further, a down-trend in margins would likely be a very serious valuation issue if a larger portion of deliveries is made up of lower-cost EVs going forward. In this sense, it remains to be seen in FY 2025 if XPeng can actually continue to grow its margins.Final thoughtsXPeng is currently crushing it in terms of deliveries, and the company delivered a healthy Q3 earnings scorecard. In November, the company's delivery growth surged, mainly due to growth momentum for the P7+ and the Mona M03 electric vehicles. While the delivery surge as well as the outlook for Q4 deliveries are positive, I still feel a little bit uncomfortable with XPeng’s margin profile… which I continue to see as inferior to those of either Li Auto or NIO. Further, I don’t see XPeng’s valuation premium with regard to other EV start-up companies as justified, especially because Li Auto and NIO are offering strong vehicle and gross margins themselves. For those reasons, I am going to continue to rate XPeng only a hold.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":380101029064720,"gmtCreate":1733823996107,"gmtModify":1733824000510,"author":{"id":"4125977394276452","authorId":"4125977394276452","name":"Bobet","avatar":"https://community-static.tradeup.com/news/default-avatar.jpg","vip":1,"crmLevel":2,"crmLevelSwitch":0,"idStr":"4125977394276452","authorIdStr":"4125977394276452"},"htmlText":"<a href=\"https://ttm.financial/S/NIO\">$NIO Inc.(NIO)$&nbsp;</a><v-v data-views=\"1\"></v-v> is way must better than<a href=\"https://ttm.financial/S/XPEV\">$XPeng Inc.(XPEV)$&nbsp;</a>yet the share price is higher than Nio.&nbsp; it's not too late to switch or buy<a href=\"https://ttm.financial/S/NIO\">$NIO Inc.(NIO)$&nbsp;</a> share while it's below $5 mark hahaha","listText":"<a href=\"https://ttm.financial/S/NIO\">$NIO Inc.(NIO)$&nbsp;</a><v-v data-views=\"1\"></v-v> is way must better than<a href=\"https://ttm.financial/S/XPEV\">$XPeng Inc.(XPEV)$&nbsp;</a>yet the share price is higher than Nio.&nbsp; it's not too late to switch or buy<a href=\"https://ttm.financial/S/NIO\">$NIO Inc.(NIO)$&nbsp;</a> share while it's below $5 mark hahaha","text":"$NIO Inc.(NIO)$ is way must better than$XPeng Inc.(XPEV)$ yet the share price is higher than Nio. it's not too late to switch or buy$NIO Inc.(NIO)$ share while it's below $5 mark hahaha","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":6,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/380101029064720","repostId":1196359058,"repostType":4,"repost":{"id":"1196359058","kind":"news","pubTimestamp":1733820520,"share":"https://ttm.financial/m/news/1196359058?lang=&edition=fundamental","pubTime":"2024-12-10 16:48","market":"us","language":"en","title":"XPeng: Not Good Enough Yet To Buy","url":"https://stock-news.laohu8.com/highlight/detail?id=1196359058","media":"seekingalpha","summary":"SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle mar","content":"<html><head></head><body><h2 id=\"id_365374367\">Summary</h2><ul style=\"\"><li><p>XPeng&#39;s deliveries are surging, driven by the Mona M03 and P7+ models, but the company&#39;s vehicle margins are still below those of Li Auto and NIO.</p></li><li><p>Despite a sequential improvement in vehicle margins to 8.6%, XPeng still lags behind Li Auto&#39;s 20.9% and NIO&#39;s 13.1% margins.</p></li><li><p>XPeng&#39;s Q4 delivery guidance is strong, projecting 87,000 to 91,000 EVs, translating to up 51% year-over-year growth.</p></li><li><p>I maintain a hold rating on XPeng stock due to its weaker margins and unjustified premium valuation compared to Li Auto and NIO.</p></li></ul><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/61c61dfda4c0f95b70cd0879cfcbe495\" alt=\"XPeng Motors Store\" title=\"XPeng Motors Store\" tg-width=\"750\" tg-height=\"500\"/><span>XPeng Motors Store</span></p><p></p><p>Shares of XPeng (NYSE:XPEV) have dropped off lately, despite the EV maker reporting a sequential improvement in its vehicle margins and benefiting from higher delivery volumes due to the launch of new EV models such as the Mona M03 and the P7+. November deliveries were also encouraging, with XPeng managing to deliver more than 30,000 electric vehicles, a record for the EV firm. Deliveries for the EV maker have been in an upswing lately and the company also submitted a strong guidance for Q4 deliveries. XPeng is still lagging behind its EV rivals in terms of vehicle margins, however, which is why I am not yet prepared to upgrade my rating.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ba8a22e89d76cc247498bcccd44599ef\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"424\"/><span>Chart</span></p><p></p><h2 id=\"id_3219377826\">Previous rating</h2><p>I rated shares of XPeng a hold in my last work on the company -- Inferior EV Investment Choice -- because the electric vehicle company experienced pressure on its margins and experienced weak delivery growth earlier this year. Companies like Li Auto (LI) and NIO (NIO) offer significantly better investment propositions, in my opinion, due to their higher vehicle margins and stronger delivery growth. While XPeng’s delivery prospects are improving, in part because of the launch of the low-cost Mona M03 EV, I believe XPeng does not deserve to trade at a higher valuation than either Li Auto or NIO.</p><h2 id=\"id_2518852215\">XPeng’s deliveries are surging, but margin profile remains inferior</h2><p>XPeng made considerable progress in the third fiscal quarter in terms of growing its vehicle margins, but the company is still lagging far behind the EV competition. XPeng generated vehicle margins of 8.6% in Q3&#39;24, showing a 2.2 PP sequential margin gain. For context, Li Auto generated vehicle margins of 20.9% (+2.2 PP Q/Q) with which the EV maker is still leading the industry start-up group. NIO generated a vehicle margin of 13.1% for the third-quarter (+0.9 PP Q/Q).</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/da35a0b394d7a77d8f6e2bd62cf9c734\" alt=\"XPeng\" title=\"XPeng\" tg-width=\"640\" tg-height=\"279\"/><span>XPeng</span></p><p></p><p>In terms of gross margins, Li Auto is also leading is also leading, although both NIO and XPeng have narrowed the gap lately. At the current moment, XPeng has the second-highest gross margins in the industry group at 15.3%. While Li Auto still has the highest gross margin of 21.5%, XPeng has the potential to catch up, mainly because of surging volume production which is driven by both the P7+ model as well as the Mona M03.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/57b1dc8291cd6665e3d12198f676a8ed\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"559\"/><span>Chart</span></p><p></p><p>The Mona M03 is an all-electric hatchback sedan that is seeing considerable growth momentum and is a key reason behind XPeng’s delivery surge lately. The P7+ is a battery-powered EV -- which is a mid to large-size electric sedan with a retail price starting at 186,800 Chinese Yuan (~$26k) -- and only started to be delivered to customers in October, so investors can expect a significant ramp here in the months ahead as well.</p><p>In the third-quarter, the company delivered 46,533 electric vehicles, which showed a 16.3% year-over-year growth rate. In November, deliveries surged for the first time ever above the 30,000 monthly delivery threshold: in the month of November, XPeng delivered a total of 30,895 electric vehicles, showing 54% growth year-over-year. The Mona M03 was launched in August 2024 and just had its third consecutive month of 10k+ deliveries. XPeng launched the Mona M03 mainly in order to offer consumers a lower-cost alternative to Tesla&#39;s (TSLA) Model 3 which costs about twice as much.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/846c0d2608a16e0de9cc93526e082c59\" alt=\"CNEVPOST\" title=\"CNEVPOST\" tg-width=\"640\" tg-height=\"335\"/><span>CNEVPOST</span></p><p></p><h2 id=\"id_492501609\">XPeng’s delivery guidance for Q4</h2><p>Due to the ramp in Mona M03 production and the recent launch of the P7+ electric vehicle, XPeng is benefiting from a considerable delivery boost that is expected to continue in Q4’24. According to XPeng’s Q3’24 earnings report, the EV firm expects to deliver a massive 87,000 to 91,000 EVs in the fourth fiscal quarter which translates to a Y/Y growth rate of between 45-51%.</p><h2 id=\"id_3019503728\">XPeng’s valuation</h2><p>Despite having weaker vehicle margins than the competition, XPeng has the highest valuation in the industry start-up group in terms of price-to-revenue ratio. Shares of XPeng are currently valued at a forward P/S ratio of 1.23X which is significantly above the valuation of Li Auto... which, due to superior execution (stronger growth, higher margins), would be deserving to lead the industry group in terms of valuation. That it does not was one reason why I called Li Auto a Best-Of-Breed EV Start-Up.</p><p>In my last work on XPeng I arrived at a fair value of $9.50 per-share based off of an average industry group P/S ratio of 0.8X. The industry group average P/S ratio has since risen to 0.9X, so I would raise my fair value target here to $10 per-share. With shares currently trading at $12.50, I consider XPeng more than fully valued. I don&#39;t rate XPeng a sell, however, due to its impressive delivery trend and progress in terms of growing vehicle and gross margins.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/beeb2f8a496fe70e844bf943b9b2519a\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"559\"/><span>Chart</span></p><p></p><h2 id=\"id_3781645470\">Risks regarding XPeng</h2><p>While XPeng is seeing a ton of interest for its Mona M03 hatchback sedan and deliveries are surging, the EV company is still lagging far behind its direct EV rivals Li Auto and NIO, both of which have stronger vehicle margins. Li Auto especially is crushing it in this regard. What would change my mind about XPeng, either to the positive or negative, would be a change in the vehicle margin trajectory. Further, a down-trend in margins would likely be a very serious valuation issue if a larger portion of deliveries is made up of lower-cost EVs going forward. In this sense, it remains to be seen in FY 2025 if XPeng can actually continue to grow its margins.</p><h2 id=\"id_4117769550\">Final thoughts</h2><p>XPeng is currently crushing it in terms of deliveries, and the company delivered a healthy Q3 earnings scorecard. In November, the company&#39;s delivery growth surged, mainly due to growth momentum for the P7+ and the Mona M03 electric vehicles. While the delivery surge as well as the outlook for Q4 deliveries are positive, I still feel a little bit uncomfortable with XPeng’s margin profile… which I continue to see as inferior to those of either Li Auto or NIO. Further, I don’t see XPeng’s valuation premium with regard to other EV start-up companies as justified, especially because Li Auto and NIO are offering strong vehicle and gross margins themselves. For those reasons, I am going to continue to rate XPeng only a hold.</p></body></html>","source":"seekingalpha_hot_news","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>XPeng: Not Good Enough Yet To Buy</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nXPeng: Not Good Enough Yet To Buy\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-10 16:48 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle ...</p>\n\n<a href=\"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09868":"小鹏汽车-W","XPEV":"小鹏汽车"},"source_url":"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1196359058","content_text":"SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle margins to 8.6%, XPeng still lags behind Li Auto's 20.9% and NIO's 13.1% margins.XPeng's Q4 delivery guidance is strong, projecting 87,000 to 91,000 EVs, translating to up 51% year-over-year growth.I maintain a hold rating on XPeng stock due to its weaker margins and unjustified premium valuation compared to Li Auto and NIO.XPeng Motors StoreShares of XPeng (NYSE:XPEV) have dropped off lately, despite the EV maker reporting a sequential improvement in its vehicle margins and benefiting from higher delivery volumes due to the launch of new EV models such as the Mona M03 and the P7+. November deliveries were also encouraging, with XPeng managing to deliver more than 30,000 electric vehicles, a record for the EV firm. Deliveries for the EV maker have been in an upswing lately and the company also submitted a strong guidance for Q4 deliveries. XPeng is still lagging behind its EV rivals in terms of vehicle margins, however, which is why I am not yet prepared to upgrade my rating.ChartPrevious ratingI rated shares of XPeng a hold in my last work on the company -- Inferior EV Investment Choice -- because the electric vehicle company experienced pressure on its margins and experienced weak delivery growth earlier this year. Companies like Li Auto (LI) and NIO (NIO) offer significantly better investment propositions, in my opinion, due to their higher vehicle margins and stronger delivery growth. While XPeng’s delivery prospects are improving, in part because of the launch of the low-cost Mona M03 EV, I believe XPeng does not deserve to trade at a higher valuation than either Li Auto or NIO.XPeng’s deliveries are surging, but margin profile remains inferiorXPeng made considerable progress in the third fiscal quarter in terms of growing its vehicle margins, but the company is still lagging far behind the EV competition. XPeng generated vehicle margins of 8.6% in Q3'24, showing a 2.2 PP sequential margin gain. For context, Li Auto generated vehicle margins of 20.9% (+2.2 PP Q/Q) with which the EV maker is still leading the industry start-up group. NIO generated a vehicle margin of 13.1% for the third-quarter (+0.9 PP Q/Q).XPengIn terms of gross margins, Li Auto is also leading is also leading, although both NIO and XPeng have narrowed the gap lately. At the current moment, XPeng has the second-highest gross margins in the industry group at 15.3%. While Li Auto still has the highest gross margin of 21.5%, XPeng has the potential to catch up, mainly because of surging volume production which is driven by both the P7+ model as well as the Mona M03.ChartThe Mona M03 is an all-electric hatchback sedan that is seeing considerable growth momentum and is a key reason behind XPeng’s delivery surge lately. The P7+ is a battery-powered EV -- which is a mid to large-size electric sedan with a retail price starting at 186,800 Chinese Yuan (~$26k) -- and only started to be delivered to customers in October, so investors can expect a significant ramp here in the months ahead as well.In the third-quarter, the company delivered 46,533 electric vehicles, which showed a 16.3% year-over-year growth rate. In November, deliveries surged for the first time ever above the 30,000 monthly delivery threshold: in the month of November, XPeng delivered a total of 30,895 electric vehicles, showing 54% growth year-over-year. The Mona M03 was launched in August 2024 and just had its third consecutive month of 10k+ deliveries. XPeng launched the Mona M03 mainly in order to offer consumers a lower-cost alternative to Tesla's (TSLA) Model 3 which costs about twice as much.CNEVPOSTXPeng’s delivery guidance for Q4Due to the ramp in Mona M03 production and the recent launch of the P7+ electric vehicle, XPeng is benefiting from a considerable delivery boost that is expected to continue in Q4’24. According to XPeng’s Q3’24 earnings report, the EV firm expects to deliver a massive 87,000 to 91,000 EVs in the fourth fiscal quarter which translates to a Y/Y growth rate of between 45-51%.XPeng’s valuationDespite having weaker vehicle margins than the competition, XPeng has the highest valuation in the industry start-up group in terms of price-to-revenue ratio. Shares of XPeng are currently valued at a forward P/S ratio of 1.23X which is significantly above the valuation of Li Auto... which, due to superior execution (stronger growth, higher margins), would be deserving to lead the industry group in terms of valuation. That it does not was one reason why I called Li Auto a Best-Of-Breed EV Start-Up.In my last work on XPeng I arrived at a fair value of $9.50 per-share based off of an average industry group P/S ratio of 0.8X. The industry group average P/S ratio has since risen to 0.9X, so I would raise my fair value target here to $10 per-share. With shares currently trading at $12.50, I consider XPeng more than fully valued. I don't rate XPeng a sell, however, due to its impressive delivery trend and progress in terms of growing vehicle and gross margins.ChartRisks regarding XPengWhile XPeng is seeing a ton of interest for its Mona M03 hatchback sedan and deliveries are surging, the EV company is still lagging far behind its direct EV rivals Li Auto and NIO, both of which have stronger vehicle margins. Li Auto especially is crushing it in this regard. What would change my mind about XPeng, either to the positive or negative, would be a change in the vehicle margin trajectory. Further, a down-trend in margins would likely be a very serious valuation issue if a larger portion of deliveries is made up of lower-cost EVs going forward. In this sense, it remains to be seen in FY 2025 if XPeng can actually continue to grow its margins.Final thoughtsXPeng is currently crushing it in terms of deliveries, and the company delivered a healthy Q3 earnings scorecard. In November, the company's delivery growth surged, mainly due to growth momentum for the P7+ and the Mona M03 electric vehicles. While the delivery surge as well as the outlook for Q4 deliveries are positive, I still feel a little bit uncomfortable with XPeng’s margin profile… which I continue to see as inferior to those of either Li Auto or NIO. Further, I don’t see XPeng’s valuation premium with regard to other EV start-up companies as justified, especially because Li Auto and NIO are offering strong vehicle and gross margins themselves. For those reasons, I am going to continue to rate XPeng only a hold.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":380092013023232,"gmtCreate":1733822947866,"gmtModify":1734073656556,"author":{"id":"4104039387995040","authorId":"4104039387995040","name":"zlance","avatar":"https://community-static.tradeup.com/news/370e81d47f8e6fe16078e6a4dbfc2bfd","vip":1,"hat":"https://static.tigerbbs.com/4c5ceab71416b120bab4604c0754b52a","crmLevel":9,"crmLevelSwitch":1,"idStr":"4104039387995040","authorIdStr":"4104039387995040"},"htmlText":"The analysis on Xpeng seems too focused on margins, which might not be the best benchmark at this stage of its growth. The priority should be on delivery volumes, as every car not sold strengthens competitors instead. High delivery numbers also enhance brand visibility and consumer awareness, crucial in competitive markets like Southeast Asia and Europe.&nbsp;&nbsp; Xpeng is strategically positioned in these regions, targeting emerging and EV-friendly markets. Focusing on deliveries will build scale and consumer trust, paving the way for improved margins later. Margins are a lagging indicator in this context; volume is the key driver for long-term success.","listText":"The analysis on Xpeng seems too focused on margins, which might not be the best benchmark at this stage of its growth. The priority should be on delivery volumes, as every car not sold strengthens competitors instead. High delivery numbers also enhance brand visibility and consumer awareness, crucial in competitive markets like Southeast Asia and Europe.&nbsp;&nbsp; Xpeng is strategically positioned in these regions, targeting emerging and EV-friendly markets. Focusing on deliveries will build scale and consumer trust, paving the way for improved margins later. Margins are a lagging indicator in this context; volume is the key driver for long-term success.","text":"The analysis on Xpeng seems too focused on margins, which might not be the best benchmark at this stage of its growth. The priority should be on delivery volumes, as every car not sold strengthens competitors instead. High delivery numbers also enhance brand visibility and consumer awareness, crucial in competitive markets like Southeast Asia and Europe. Xpeng is strategically positioned in these regions, targeting emerging and EV-friendly markets. Focusing on deliveries will build scale and consumer trust, paving the way for improved margins later. Margins are a lagging indicator in this context; volume is the key driver for long-term success.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":17,"commentSize":1,"repostSize":0,"link":"https://ttm.financial/post/380092013023232","repostId":1196359058,"repostType":2,"repost":{"id":"1196359058","kind":"news","pubTimestamp":1733820520,"share":"https://ttm.financial/m/news/1196359058?lang=&edition=fundamental","pubTime":"2024-12-10 16:48","market":"us","language":"en","title":"XPeng: Not Good Enough Yet To Buy","url":"https://stock-news.laohu8.com/highlight/detail?id=1196359058","media":"seekingalpha","summary":"SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle mar","content":"<html><head></head><body><h2 id=\"id_365374367\">Summary</h2><ul style=\"\"><li><p>XPeng&#39;s deliveries are surging, driven by the Mona M03 and P7+ models, but the company&#39;s vehicle margins are still below those of Li Auto and NIO.</p></li><li><p>Despite a sequential improvement in vehicle margins to 8.6%, XPeng still lags behind Li Auto&#39;s 20.9% and NIO&#39;s 13.1% margins.</p></li><li><p>XPeng&#39;s Q4 delivery guidance is strong, projecting 87,000 to 91,000 EVs, translating to up 51% year-over-year growth.</p></li><li><p>I maintain a hold rating on XPeng stock due to its weaker margins and unjustified premium valuation compared to Li Auto and NIO.</p></li></ul><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/61c61dfda4c0f95b70cd0879cfcbe495\" alt=\"XPeng Motors Store\" title=\"XPeng Motors Store\" tg-width=\"750\" tg-height=\"500\"/><span>XPeng Motors Store</span></p><p></p><p>Shares of XPeng (NYSE:XPEV) have dropped off lately, despite the EV maker reporting a sequential improvement in its vehicle margins and benefiting from higher delivery volumes due to the launch of new EV models such as the Mona M03 and the P7+. November deliveries were also encouraging, with XPeng managing to deliver more than 30,000 electric vehicles, a record for the EV firm. Deliveries for the EV maker have been in an upswing lately and the company also submitted a strong guidance for Q4 deliveries. XPeng is still lagging behind its EV rivals in terms of vehicle margins, however, which is why I am not yet prepared to upgrade my rating.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ba8a22e89d76cc247498bcccd44599ef\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"424\"/><span>Chart</span></p><p></p><h2 id=\"id_3219377826\">Previous rating</h2><p>I rated shares of XPeng a hold in my last work on the company -- Inferior EV Investment Choice -- because the electric vehicle company experienced pressure on its margins and experienced weak delivery growth earlier this year. Companies like Li Auto (LI) and NIO (NIO) offer significantly better investment propositions, in my opinion, due to their higher vehicle margins and stronger delivery growth. While XPeng’s delivery prospects are improving, in part because of the launch of the low-cost Mona M03 EV, I believe XPeng does not deserve to trade at a higher valuation than either Li Auto or NIO.</p><h2 id=\"id_2518852215\">XPeng’s deliveries are surging, but margin profile remains inferior</h2><p>XPeng made considerable progress in the third fiscal quarter in terms of growing its vehicle margins, but the company is still lagging far behind the EV competition. XPeng generated vehicle margins of 8.6% in Q3&#39;24, showing a 2.2 PP sequential margin gain. For context, Li Auto generated vehicle margins of 20.9% (+2.2 PP Q/Q) with which the EV maker is still leading the industry start-up group. NIO generated a vehicle margin of 13.1% for the third-quarter (+0.9 PP Q/Q).</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/da35a0b394d7a77d8f6e2bd62cf9c734\" alt=\"XPeng\" title=\"XPeng\" tg-width=\"640\" tg-height=\"279\"/><span>XPeng</span></p><p></p><p>In terms of gross margins, Li Auto is also leading is also leading, although both NIO and XPeng have narrowed the gap lately. At the current moment, XPeng has the second-highest gross margins in the industry group at 15.3%. While Li Auto still has the highest gross margin of 21.5%, XPeng has the potential to catch up, mainly because of surging volume production which is driven by both the P7+ model as well as the Mona M03.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/57b1dc8291cd6665e3d12198f676a8ed\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"559\"/><span>Chart</span></p><p></p><p>The Mona M03 is an all-electric hatchback sedan that is seeing considerable growth momentum and is a key reason behind XPeng’s delivery surge lately. The P7+ is a battery-powered EV -- which is a mid to large-size electric sedan with a retail price starting at 186,800 Chinese Yuan (~$26k) -- and only started to be delivered to customers in October, so investors can expect a significant ramp here in the months ahead as well.</p><p>In the third-quarter, the company delivered 46,533 electric vehicles, which showed a 16.3% year-over-year growth rate. In November, deliveries surged for the first time ever above the 30,000 monthly delivery threshold: in the month of November, XPeng delivered a total of 30,895 electric vehicles, showing 54% growth year-over-year. The Mona M03 was launched in August 2024 and just had its third consecutive month of 10k+ deliveries. XPeng launched the Mona M03 mainly in order to offer consumers a lower-cost alternative to Tesla&#39;s (TSLA) Model 3 which costs about twice as much.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/846c0d2608a16e0de9cc93526e082c59\" alt=\"CNEVPOST\" title=\"CNEVPOST\" tg-width=\"640\" tg-height=\"335\"/><span>CNEVPOST</span></p><p></p><h2 id=\"id_492501609\">XPeng’s delivery guidance for Q4</h2><p>Due to the ramp in Mona M03 production and the recent launch of the P7+ electric vehicle, XPeng is benefiting from a considerable delivery boost that is expected to continue in Q4’24. According to XPeng’s Q3’24 earnings report, the EV firm expects to deliver a massive 87,000 to 91,000 EVs in the fourth fiscal quarter which translates to a Y/Y growth rate of between 45-51%.</p><h2 id=\"id_3019503728\">XPeng’s valuation</h2><p>Despite having weaker vehicle margins than the competition, XPeng has the highest valuation in the industry start-up group in terms of price-to-revenue ratio. Shares of XPeng are currently valued at a forward P/S ratio of 1.23X which is significantly above the valuation of Li Auto... which, due to superior execution (stronger growth, higher margins), would be deserving to lead the industry group in terms of valuation. That it does not was one reason why I called Li Auto a Best-Of-Breed EV Start-Up.</p><p>In my last work on XPeng I arrived at a fair value of $9.50 per-share based off of an average industry group P/S ratio of 0.8X. The industry group average P/S ratio has since risen to 0.9X, so I would raise my fair value target here to $10 per-share. With shares currently trading at $12.50, I consider XPeng more than fully valued. I don&#39;t rate XPeng a sell, however, due to its impressive delivery trend and progress in terms of growing vehicle and gross margins.</p><p></p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/beeb2f8a496fe70e844bf943b9b2519a\" alt=\"Chart\" title=\"Chart\" tg-width=\"635\" tg-height=\"559\"/><span>Chart</span></p><p></p><h2 id=\"id_3781645470\">Risks regarding XPeng</h2><p>While XPeng is seeing a ton of interest for its Mona M03 hatchback sedan and deliveries are surging, the EV company is still lagging far behind its direct EV rivals Li Auto and NIO, both of which have stronger vehicle margins. Li Auto especially is crushing it in this regard. What would change my mind about XPeng, either to the positive or negative, would be a change in the vehicle margin trajectory. Further, a down-trend in margins would likely be a very serious valuation issue if a larger portion of deliveries is made up of lower-cost EVs going forward. In this sense, it remains to be seen in FY 2025 if XPeng can actually continue to grow its margins.</p><h2 id=\"id_4117769550\">Final thoughts</h2><p>XPeng is currently crushing it in terms of deliveries, and the company delivered a healthy Q3 earnings scorecard. In November, the company&#39;s delivery growth surged, mainly due to growth momentum for the P7+ and the Mona M03 electric vehicles. While the delivery surge as well as the outlook for Q4 deliveries are positive, I still feel a little bit uncomfortable with XPeng’s margin profile… which I continue to see as inferior to those of either Li Auto or NIO. Further, I don’t see XPeng’s valuation premium with regard to other EV start-up companies as justified, especially because Li Auto and NIO are offering strong vehicle and gross margins themselves. For those reasons, I am going to continue to rate XPeng only a hold.</p></body></html>","source":"seekingalpha_hot_news","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>XPeng: Not Good Enough Yet To Buy</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nXPeng: Not Good Enough Yet To Buy\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-10 16:48 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle ...</p>\n\n<a href=\"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09868":"小鹏汽车-W","XPEV":"小鹏汽车"},"source_url":"https://seekingalpha.com/article/4742939-xpeng-not-good-enough-yet-to-buy","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1196359058","content_text":"SummaryXPeng's deliveries are surging, driven by the Mona M03 and P7+ models, but the company's vehicle margins are still below those of Li Auto and NIO.Despite a sequential improvement in vehicle margins to 8.6%, XPeng still lags behind Li Auto's 20.9% and NIO's 13.1% margins.XPeng's Q4 delivery guidance is strong, projecting 87,000 to 91,000 EVs, translating to up 51% year-over-year growth.I maintain a hold rating on XPeng stock due to its weaker margins and unjustified premium valuation compared to Li Auto and NIO.XPeng Motors StoreShares of XPeng (NYSE:XPEV) have dropped off lately, despite the EV maker reporting a sequential improvement in its vehicle margins and benefiting from higher delivery volumes due to the launch of new EV models such as the Mona M03 and the P7+. November deliveries were also encouraging, with XPeng managing to deliver more than 30,000 electric vehicles, a record for the EV firm. Deliveries for the EV maker have been in an upswing lately and the company also submitted a strong guidance for Q4 deliveries. XPeng is still lagging behind its EV rivals in terms of vehicle margins, however, which is why I am not yet prepared to upgrade my rating.ChartPrevious ratingI rated shares of XPeng a hold in my last work on the company -- Inferior EV Investment Choice -- because the electric vehicle company experienced pressure on its margins and experienced weak delivery growth earlier this year. Companies like Li Auto (LI) and NIO (NIO) offer significantly better investment propositions, in my opinion, due to their higher vehicle margins and stronger delivery growth. While XPeng’s delivery prospects are improving, in part because of the launch of the low-cost Mona M03 EV, I believe XPeng does not deserve to trade at a higher valuation than either Li Auto or NIO.XPeng’s deliveries are surging, but margin profile remains inferiorXPeng made considerable progress in the third fiscal quarter in terms of growing its vehicle margins, but the company is still lagging far behind the EV competition. XPeng generated vehicle margins of 8.6% in Q3'24, showing a 2.2 PP sequential margin gain. For context, Li Auto generated vehicle margins of 20.9% (+2.2 PP Q/Q) with which the EV maker is still leading the industry start-up group. NIO generated a vehicle margin of 13.1% for the third-quarter (+0.9 PP Q/Q).XPengIn terms of gross margins, Li Auto is also leading is also leading, although both NIO and XPeng have narrowed the gap lately. At the current moment, XPeng has the second-highest gross margins in the industry group at 15.3%. While Li Auto still has the highest gross margin of 21.5%, XPeng has the potential to catch up, mainly because of surging volume production which is driven by both the P7+ model as well as the Mona M03.ChartThe Mona M03 is an all-electric hatchback sedan that is seeing considerable growth momentum and is a key reason behind XPeng’s delivery surge lately. The P7+ is a battery-powered EV -- which is a mid to large-size electric sedan with a retail price starting at 186,800 Chinese Yuan (~$26k) -- and only started to be delivered to customers in October, so investors can expect a significant ramp here in the months ahead as well.In the third-quarter, the company delivered 46,533 electric vehicles, which showed a 16.3% year-over-year growth rate. In November, deliveries surged for the first time ever above the 30,000 monthly delivery threshold: in the month of November, XPeng delivered a total of 30,895 electric vehicles, showing 54% growth year-over-year. The Mona M03 was launched in August 2024 and just had its third consecutive month of 10k+ deliveries. XPeng launched the Mona M03 mainly in order to offer consumers a lower-cost alternative to Tesla's (TSLA) Model 3 which costs about twice as much.CNEVPOSTXPeng’s delivery guidance for Q4Due to the ramp in Mona M03 production and the recent launch of the P7+ electric vehicle, XPeng is benefiting from a considerable delivery boost that is expected to continue in Q4’24. According to XPeng’s Q3’24 earnings report, the EV firm expects to deliver a massive 87,000 to 91,000 EVs in the fourth fiscal quarter which translates to a Y/Y growth rate of between 45-51%.XPeng’s valuationDespite having weaker vehicle margins than the competition, XPeng has the highest valuation in the industry start-up group in terms of price-to-revenue ratio. Shares of XPeng are currently valued at a forward P/S ratio of 1.23X which is significantly above the valuation of Li Auto... which, due to superior execution (stronger growth, higher margins), would be deserving to lead the industry group in terms of valuation. That it does not was one reason why I called Li Auto a Best-Of-Breed EV Start-Up.In my last work on XPeng I arrived at a fair value of $9.50 per-share based off of an average industry group P/S ratio of 0.8X. The industry group average P/S ratio has since risen to 0.9X, so I would raise my fair value target here to $10 per-share. With shares currently trading at $12.50, I consider XPeng more than fully valued. I don't rate XPeng a sell, however, due to its impressive delivery trend and progress in terms of growing vehicle and gross margins.ChartRisks regarding XPengWhile XPeng is seeing a ton of interest for its Mona M03 hatchback sedan and deliveries are surging, the EV company is still lagging far behind its direct EV rivals Li Auto and NIO, both of which have stronger vehicle margins. Li Auto especially is crushing it in this regard. What would change my mind about XPeng, either to the positive or negative, would be a change in the vehicle margin trajectory. Further, a down-trend in margins would likely be a very serious valuation issue if a larger portion of deliveries is made up of lower-cost EVs going forward. In this sense, it remains to be seen in FY 2025 if XPeng can actually continue to grow its margins.Final thoughtsXPeng is currently crushing it in terms of deliveries, and the company delivered a healthy Q3 earnings scorecard. In November, the company's delivery growth surged, mainly due to growth momentum for the P7+ and the Mona M03 electric vehicles. While the delivery surge as well as the outlook for Q4 deliveries are positive, I still feel a little bit uncomfortable with XPeng’s margin profile… which I continue to see as inferior to those of either Li Auto or NIO. Further, I don’t see XPeng’s valuation premium with regard to other EV start-up companies as justified, especially because Li Auto and NIO are offering strong vehicle and gross margins themselves. For those reasons, I am going to continue to rate XPeng only a hold.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":381132305883248,"gmtCreate":1734073717541,"gmtModify":1734073913010,"authorId":10000000000010976,"author":{"id":10000000000010976,"idStr":"10000000000010975","authorId":10000000000010976,"name":"gogoooCn","avatar":"https://static.tigerbbs.com/b17af8d14081700b793911bb75de6b67","vip":8,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":380092013023232,"type":1,"supId":0,"prevId":0,"content":"<p>Always believe in Chinese EVs</p>","text":"<p>Always believe in Chinese EVs</p>","html":"<p>Always believe in Chinese EVs</p>"}],"langContent":"EN"}],"isCommentEnd":false,"newsSizeData":{"likeSize":1,"commentSize":3,"repostSize":2,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/1196359058"}