Xpeng's stock could gather some upward momentum from investors driven by the positive sentiment around XPILOT 3.0 and its upcoming new sedan with LiDAR, according to Deutsche Bank analysts led by Edison Yu in a note to investors on Thursday.
It becomes clear XPILOT 3.0 will be the best consumer autonomy system on the Chinese market for likely at least the rest of the year, Yu's team said, adding the excitement is also building for the unveiling of its third model.
The bank reaffirmed its Buy rating and $58 price target on Xpeng, which surged 6 percent in the early hours on Thursday. The stock closed 3.53 percent higher to trade 54.31.
Yu's team said they believe there was also a long Nio/short XPEV trade going into Nio Day which has largely been unwound and concerns about the lock-up next month are overblown given most large and/or strategic investors will be committed for the long term.
Catalysts in the coming months include the official over-the-air (OTA) release of NGP (before Chinese New Year on 2/12) and beyond that, beta demonstrations of the new memory valet parking feature and unveiling of Xpeng's third model in the second quarter, the bank said.
Earlier this month, Xpeng announced a new sedan was coming, which will feature a new design and hints that it will be equipped with LiDAR.
Judging from the body profile, the sedan appears to be more compact than the company's current sedan, the Xpeng P7, and thus is expected to be less expensive.
Yu's team also thinks Nio, which already held its flagship event earlier this month, and Li Auto will likely have little to announce the rest of the year and will face more perceived competition from Tesla's China-made Model Y on a relative basis, potentially giving Xpeng a cleaner narrative in the near term.
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