XPeng’s Strong Financial Performance and Strategic Positioning Justify Buy Rating

Analyst Tim Hsiao of Morgan Stanley maintained a Buy rating on XPeng, Inc. ADR (XPEV – Research Report), with a price target of $26.00.

Tim Hsiao has given his Buy rating due to a combination of factors including XPeng’s strong financial performance and strategic positioning. The company reported a significant reduction in net loss for the first quarter of 2025, which was better than expected, largely due to increased government subsidies. Additionally, XPeng’s revenue grew substantially year-over-year, surpassing its own guidance, driven by higher vehicle deliveries.
Moreover, XPeng’s vehicle gross margin improved, benefiting from economies of scale and cost-saving measures, which helped offset a less favorable product mix. The company’s operating expenses also declined, reflecting efficient cost management. Looking forward, XPeng’s guidance for the second quarter suggests continued growth in vehicle deliveries and revenue, supporting the positive outlook and the Buy rating.

According to TipRanks, Hsiao is an analyst with an average return of -1.6% and a 37.61% success rate. Hsiao covers the Consumer Cyclical sector, focusing on stocks such as BYD Co, Geely Automobile Holdings, and Nio.