Stock XPEV looks great as EV maker overcomes supply chain issues

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  • Xpeng (XPEV) is about to release its highly anticipated quarterly results.
  • However, the company has already released some data indicating powerful growth.
  • Investors can buy or hold Xpeng shares as the company apparently has no difficulty delivering its smart vehicles.

Source: Johnnie Rik / Shutterstock.com

Chinese smart electric vehicle (EV) manufacturer Xpeng (NYSE:XPEV) is a competitor in a crowded field, in an era of Chinese Covid-19 lockdowns and supply chain issues. Still, it’s good to buy or hold XPEV stock because Xpeng is on the fast track to impressive revenue generation.

Here is a date to mark on your calendar. Xpeng expects to release its unaudited first quarter 2022 financial results on May 23. So should worried investors sell their shares ahead of the earnings release?

It might be tempting to do so, as XPEV stock has been on a downward trajectory for some time. However, panic selling is not necessary as Xpeng has amazing stats for you even before the win event takes place.

What’s going on with XPEV Stock?

Admittedly, it is a difficult time to be an Xpeng investor. After peaking at $56.45 late last year, the stock price headed towards $20 not too long ago.

Most likely, supply chain issues are to blame for this drop in stock prices. There are also Covid-19 lockdowns in China to consider.

However, at least one expert in Wall Street doesn’t seem too concerned about Xpeng’s future. Indeed, Deutsche Bank analyst Edison Yu reiterated a “buy” rating for XPEV stock, and even issued a very ambitious price target of $55.

In defense of this share price target, Yu cited “Xpeng’s strong order book, supply chain resilience and consumer-grade advanced self-driving capability (XPILOT 3.5 with Lidar)”.

Can’t deny the results

Yu certainly pointed to strong bullish catalysts for Xpeng. Still, skeptical investors may want to see hard data even before the next earnings release.

No problem – Xpeng recently released its vehicle results for April 2022. Even the most ardent skeptics would find it hard to deny the revealing data provided by Xpeng.

If you can believe it, Xpeng delivered 9,002 smart electric vehicles in April, up 75% year-on-year. Not only that, but the company’s total year-to-date shipments to April 30 reached 43,563, up 136% year-on-year.

Those are terrific stats, especially given the tough conditions. Xpeng acknowledged “the COVID situation, which in turn affects the overall supply chain, manufacturing and transportation of automobiles in China,” but still managed to produce exceptional delivery figures for April.

What you can do now

It’s fine if you disagree with Yu’s $55 price target for XPEV stock. At the very least, however, investors should take heed of Xpeng’s vast improvement in smart electric vehicle deliveries.

Therefore, you can choose to buy or hold Xpeng shares even if you are concerned about the upcoming earnings report. Beat or fail, there’s no denying that as a competitor in the EV market, Xpeng is accelerating rapidly.

As of the date of publication, David Moadel had no position (directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.

David Moadel has delivered compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga and (of course) InvestorPlace.com. He is also the Chief Analyst and Market Researcher for Portfolio Wealth Global and hosts the popular YouTube financial channel Looking at the Markets.

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