XPeng Is the Latest EV Company to Report Positive Delivery News

Deliveries beat XPeng’s own initial projections. XPeng management said on its third-quarter earnings conference call that it expected to deliver about 10,000 vehicles in the fourth quarter.

All three U.S. listed Chinese EV stocks had a busy weekend, with each one reporting delivery numbers. The theme was the same for all—XPeng, along with NIO (NIO) and Li Auto (Li) exceeded internal projections. NIO delivered more than 17,000 vehicles, about 1,000 more than management projected. Li delivered over 14,000 vehicles, roughly 3,000 more than management had forecast.

EV leader Tesla (TSLA) also reported fourth-quarter deliveries over the weekend. Elon Musk’s company delivered more than 180,000 vehicles in the fourth quarter, which was better than the roughly 176,000 vehicles analysts projected.

Predicting investor reaction to the Chinese EV announcements isn’t easy. All three stocks fell after reporting strong November deliveries. Although Li had sold more stock to raise cash around the time the three released November delivery figures.

Falling on good news, however, is a common bull market action, and EV stocks are definitely in a bull market. Tesla rose about 740% in 2020 and is now the world’s most valuable car company by a wide margin. XPeng stock closed 2020 at $42.83, up substantially from its summer IPO price of $15 a share.

The gains make XPeng, and the Chinese EV sector as a whole, expensive. XPeng, for instance, trades for about 15 times estimated 2021 sales. Barron’s recently wrote that Chinese EV stocks look too pricey. That article appeared in mid-December, and the Chinese EV stocks, on average, trade about where they did then.

Wall Street, for the most part, disagrees with Barron’s. More than 60% of analysts rate the three Chinese EV stocks—NIO, Li and XPeng—at Buy. The average Buy rating ratio for stocks in the Dow Jones Industrial Average is about 57%.

For XPeng, 67% of analysts covering the company rate the stock at Buy. The average analyst price target is about $49 a share.

Monday should be an interesting day. Investors also have Tesla’s recent Model Y pricing in China to deal with. The Model Y crossover is priced below a NIO EC6. The XPeng crossover EV—the model G3—is priced below both the NIO and the Tesla crossovers. But, any concerns among investors about price cuts could be offset by this weekend’s delivery numbers.

Write to Al Root at allen.root@dowjones.com