XPeng (NYSE:XPEV) stock is getting a boost on Monday after Bank of America analyst Ming Hsun Lee upgraded the electric vehicle (EV) company’s shares.
That upgrade has the rating for XPEV stock at the firm increasing from a “neutral” rating to a “buy” rating. For the record, the analyst consensus rating for XPEV shares is a “hold” based on 13 opinions.
To go along with that upgrade, the Bank of America analyst set a price target of $22 per share for XPEV stock. That represents a potential upside of 49% over the next 12 months compared to Friday’s close. It’s also sitting above the analyst consensus price prediction of $15.43 per share.
Why the Bullish Stance on XPEV Stock?
Lee listed the following benefits for XPEV stock in a note to clients obtained by CNBC:
“(1) investors’ concerns over XPeng’s fast cash burn will be lower, which supports valuation; (2) XPeng’s AD capability is endorsed. We estimate it to record annual technology service income of RMB200-300mn per annum in 2024-25; (3) XPeng could manage cost better through larger scale procurement and stronger supply chain shared with VW.”
XPEV stock is up 12% as of Monday morning. That comes as some 9 million shares change hands. To put that in perspective, the company’s daily average trading volume is about 21.6 million shares.
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On the date of publication, William White 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 InvestorPlace.com Publishing Guidelines.
