What a gloomy day for Chinese electric vehicle stocks. Just a few hours ago, it looked like a turnaround story was brewing. Nio (NYSE:NIO) reported a monthly delivery record, as did Xpeng (NYSE:XPEV). Then, Wall Street started to process a short-selling report from Kandi Technologies (NASDAQ:KNDI). The rest is history. Xpeng stock and LI stock tumbled in response.
So what do investors really need to know now? And is there reason for panic because of the Hindenburg Research report?
Well, the short answer is that there is no direct reason for panic today. What investors did learn is that it is important to be careful. Kandi Technologies has been captivating investor interest — and $160 million — in recent weeks. On the surface, the company represents a way to play growing consumer EV adoption and a need for low-cost cars. Plus, KNDI stock has found success because Kandi vehicles are already in the United States.
Hindenburg Research seriously disrupted that appeal. The short-selling firm highlighted how easy it is for a company to take advantage of U.S. investors. As the allegations tell it, Kandi has been falsifying its revenue, as well as misleading investors over its battery-swap and ride-hailing plans. All the company had to do was tie its story to the EV stock trend.
For investors, this appears to be a wake up call. However, as John Rosevear wrote for The Motley Fool today, Kandi is no stranger to “financial shenanigans.” Nio, Xpeng and Li Auto look a lot safer. Use this moment to do your own research and make sure to consume all the info you can find on Xpeng stock and LI stock.
Xpeng Stock Offers a Silver Lining
As investors digest the Kandi Technologies report, they should also pay attention to news from earlier this morning. Right as the month started, Xpeng stock seemed ready to soar on its monthly delivery updates. Why? Well, in the Tuesday announcement, the company shared that it delivered a total of 4,224 EVs in November 2020. This is up from its 3,478 deliveries in September and 3,040 deliveries in October. Importantly, the September figure was the previous record.
That means Xpeng stock is continuing to prove itself to investors. Not only is the November figure a new record, it represents 342% growth year-over-year. This month, Xpeng delivered 2,732 of its P7 sedan and 1,492 of its G3 SUV. Lastly, its year-to-date deliveries are an 87% improvement year-over-year.
As the market figures out what to do with Kandi Technologies, remember to stick with the facts when it comes to LI stock and Xpeng stock. As of this morning, those facts looked pretty good.
Xpeng stock is currently down 5.1% while LI stock is down 1%.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer with InvestorPlace.com.
