CEO He Xiaopeng Just Doubled Down on XPEV Stock. Here’s Why.

  • CEO He Xiaopeng disclosed purchasing 2.2 million shares of XPeng (XPEV).
  • The shares were purchased on the open market at an average price of $13.58 per share.
  • Shares of XPEV stock are down more than 65% year-to-date.
XPEV stock - CEO He Xiaopeng Just Doubled Down on XPEV Stock. Here’s Why.

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Shares of XPeng (NYSE:XPEV) stock are in full focus after it was disclosed that CEO He Xiaopeng purchased $30 million worth of XPEV stock. In August, the Chinese electric vehicle (EV) manufacturer delivered 9,578 vehicles, up 33% year-over-year (YOY). Year-to-date (YTD), XPeng has delivered a total of 90,085 vehicles, up an impressive 96% YOY.

Still, shares of the company are down more than 65% YTD. XPeng has dealt with a plethora of issues this year, including supply chain challenges, lockdowns in China and inflation. This appears to reflect a good backdrop for Xiaopeng to step in and purchase shares at a relative discount. Let’s get into the details.

XPEV Stock: CEO He Xiaopeng Purchases 2.2 Million Shares

On Sept. 23, Xiaopeng purchased 2.2 million shares of XPEV in the open market at an average price of $13.58 per share. The shares were acquired through Simplicity Holding, which is wholly owned by the CEO. After the purchase, Simplicity now owns a total of 2.2 million American depository shares (ADS) and 327.7 million Class B ordinary shares. He also owns an additional 21 million Class B shares through Respect Holding. In total, Xiaopeng has a 20.5% stake in his company.

Following the transaction, XPeng’s board stated that the purchase “demonstrates the strong confidence of Mr. Xiaopeng He towards the prospects and growth potential of the Company, as well as his long-term commitment towards the Company.”

That certainly seems to be the case. Insiders may sell stock for a variety of reasons, such as for personal expenses, tax obligations or a loss of faith in the company. However, they only buy for one reason: they believe the price will go up.

XPeng Debuts Its City Navigation Guided Pilot Program

Earlier this month, the EV company announced the initiation of the pilot program for its City Navigation Guided Pilot (NGP). For now, only residents of Guangzhou with the XPeng P5 can access the program through an over-the-air (OTA) update.

City NGP is a “high-level” advanced driver assistance system (ADAS) that can perform actions such as lane-changing, merging, passing stationary vehicles, and reading traffic signals. XPeng did not disclose when City NGP would be available in other cities, although the launch is a welcome milestone in a volatile year for Chinese stocks.

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Eddie Pan specializes in institutional investments and insider activity. He writes for InvestorPlace’s Today’s Market team, which centers on the latest news involving popular stocks.

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