XPeng Triples, Li Auto Doubles, Nio Halts Deliveries in October

Chinese EV stocks mixed on Monday on October results. Earlier, Bernstein rated XPeng highest among the three.
Nov. 01, 2021 17:04
XPeng Triples, Li Auto Doubles, Nio Halts Deliveries in October

(CapitalWatch, Nov. 1, New York) October showed mixed sales for Chinese EV stocks and early trading on Monday reflected the results: Nio opened 3% in the red, Li Auto climbed 1%, and XPeng gained 5%. Let's look at last month's deliveries and developments.

To start with the biggest gainer, XPeng Inc. (Nasdaq: XPEV; HKEX: 9868) enjoyed tripled deliveries in October, at 10,138. A slight decline from the September record of 10,412, the company posted 233% year-over-year improvement. Perhaps, the results could have been better if it wasn't for chip shortage.

XPeng noted "strong market appeal" for its P5 smart family sedans launched in September. Of those, XPeng delivered 437 units last month and saw "a solid order backlog." The new car, priced in the range of $24,500 to $34,700, was seen as an affordable option next to Tesla's Model 3 in China and said to begin deliveries in late October.

The P7 sports sedan remained XPeng's top seller, while the G3 and G3i SUV sales hit a monthly record.

Year-to-date, XPeng has delivered 66,542 vehicles and now offers free supercharging services at 1,648 stations in 221 cities across China.

Earlier this month, XPeng released its environmental report showing the highest MSCI ESG rating among global automakers. At the time, Barron's called XPeng "a more sustainable EV maker than even Tesla."

In the most recent analyst report on XPeng, Bernstein analyst Eunice Lee gave XPEV an "outperform" and a $56 price target compared to its level of $48 per share as of Monday morning.

Li Auto Inc. (Nasdaq: LI; HKEX: 2015) showed doubled deliveries year-over-year, at 7,649. That's also an 8% improvement compared to the prior month's sales. Year-to-date, Li is slightly behind XPeng, with 62,919 deliveries so far in 2021 – but considering the company has just one model on the market, though recently upgraded, that can be called a solid year.

In its statement today, Li Auto noted its production milestone of 100,000, with co-founder and president Yanan Shen saying the company was "the fastest to achieve this among emerging NEV manufacturers in China."

Shen added, "Our order intake exceeded 14,500 units in October, and we are working in earnest with our suppliers to fully restore the millimeter wave radar supply, aiming to shorten the waiting time of delivery to our users."

Two weeks back, Nomura's Martin Heung initiated Li Auto with a "buy" and a $43.40 per share target. The analyst noted Li Auto's advantage was its extended-range-electric-vehicle (EREV).

Similarly, last week, Bernstein's Lee forecast $43 per share for the company. The forecasts represent a 30% upside to today's LI stock price of $33.25.

As to Nio Inc. (NYSE: NIO), this stock was down early on Monday but jumped back to green territory, trading at $40.40 per share as of midday. The company's restructuring in October significantly weighed on its deliveries, which it said reached 3,667 units, a 28% decrease from a year ago.

Specifically, Nio attributed the reduction in production volume to the "upgrades of manufacturing lines and the preparation of new products introduction," "as well as certain supply chain volatilities."

However, Nio said it saw "another all-time high" in new orders in October and said the production of ES8 has resumed. Compared with the results of September, Nio has lost its leading position among U.S.-listed EV rivals, but its cumulative sales figures are still ahead.

Bernstein's Lee began coverage of Nio last week at a "market perform" with a $45 price target, rating it lower than rivals XPeng and Li Auto.

Next year, Nio plans to begin delivering its first sedan, the ET7.