Is it the end of the road for XPeng (NYSE:XPEV) now that China’s e-commerce king plans to unload some shares of the China-based automaker? Not at all. As we’ll see, XPeng’s recent electric vehicle delivery results should convince enterprising investors to buy XPEV stock, not sell it.
You can note corporations’ large-scale stock purchases and sales, you must make your own investment decisions. So, I invite you to conduct your due diligence and, if you’re in the market for a potential winner in the international EV market, grab a few shares of XPeng stock.
Alibaba Cuts Its Stake in XPEV Stock
According to Bloomberg, Taobao China Holding Ltd., a subsidiary of Chinese e-commerce company Alibaba (NYSE:BABA), plans to sell 25 million XPeng American depositary receipts (ADRs). The total value of these ADRs, at the time this was reported, was $391 million.
There’s really no need to worry about this share sale. The Alibaba subsidiary will still hold a 7.5% stake in XPeng. Furthermore, an Alibaba spokesperson expressed his company’s continued confidence in XPeng.
“We have a strategic relationship with XPeng, which is one of China’s leaders in electric vehicles. We believe in XPeng’s prospects and look forward to continued cooperation with the company,” they said.
It’s hard to blame Alibaba’s management for maintaining a stake in XPeng. This is an automaker that continues to push the envelope in automotive technology.
For example, XPeng recently expanded the availability of its XNGP Advanced Driver Assistance System to 27 additional cities in China. This best-in-class ADAS is “optimized to adapt to different cities’ driving scenarios.” Now, it’s available for XPENG Max trim customers in 52 Chinese cities.
XPeng Delivers a November to Remember
XPeng’s critics might worry about Alibaba’s XPEV share sale, even if their concern is irrational. Yet, they can’t possibly argue with XPeng’s November EV delivery growth.
Let’s back up for a moment, though. In 2023’s third quarter, XPeng delivered 40,008 vehicles, up 72.4% quarter over quarter. Moreover, the company’s Q3 2023 revenue grew 68.5% QOQ and 25% year over year to 8.53 billion RMB ($1.17 billion).
Fast-forward to November, and we can see that XPeng continued to serve up striking stats. During that month, XPeng managed to deliver 20,041 Smart EVs, up 245% YOY.
Thus, it appears that XPeng is on track to reach its fourth-quarter 2023 goal of delivering 59,500 to 63,500 vehicles. If the company achieves this, XPeng’s fourth-quarter EV delivery growth would be 101.2% to 114.7%, believe it or not.
Don’t Obsess Over Alibaba’s Sale of XPeng Stock
As you can see, XPeng is truly in the fast lane. The automaker is growing its revenue and EV deliveries. Besides, Alibaba is still confident in XPeng’s future prospects even after reducing its stake in XPEV stock.
So, don’t be afraid to invest internationally and don’t obsess over Alibaba’s XPeng share sale. 2024 could be an amazing year for XPEV stock, and I encourage investors to grab a handful of shares today.
On the date of publication, David Moadel did not have (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.
