Investing.com – Goldman Sachs downgraded its rating Xpeng Inc. (NYSE:). to “neutral” from “buy”, citing growing competitive challenges in China’s new energy vehicle (NEV) market and stocks that have already significantly outperformed in recent months, leaving less room for growth .
XPeng’s US-listed shares last traded up 3.6% at $12.2 in New York.
XPeng shares have risen 67% in the US and 83% in Hong Kong in the past two months, driven by strong orders and deliveries of its new models, including the M03 and P7+.
Goldman anticipates XPeng vehicle deliveries will increase 81% year-on-year in 2025, supported by the launch of at least four new models. However, intensifying price cuts, particularly in the first quarter of 2025, and uncertainty over government trade subsidies weigh on the outlook.
Goldman raised its revenue forecasts for XPeng for 2024-2026 by 5% to 9%, reflecting expectations for sales growth.
The investment bank adjusted its 12-month price target for XPeng to $12.50 per US ADR and HK$49 per Hong Kong share, representing a slight downside from current levels, the note added.
Goldman’s downgrade follows its initial “Buy” rating in July, during which XPeng’s US ADRs underperformed by 49 percentage points, amid increased domestic competition.
While XPeng has shown strength recently with improving margins and order volumes, Goldman remains cautious about potential risks, including intensifying market competition and production challenges.