Xpeng Stock Jumps, Retail Turns ‘Bullish’ After CEO Boosts Stake

Shares of Xpeng Inc. (XPEV) rose more than 7% on Monday, lifting retail sentiment to the highest in almost a week, after CEO Xiaopeng He made a significant purchase of the company stock.

Between August 21 and August 23, he bought one million H-shares at 27.13 Hong Kong dollars per share and 1.42 million American depositary shares (ADS) at $7.02 each, according to the Wall Street Journal.

The CEO plans to further increase his stake, following regulatory guidelines.

This insider buying sparked optimism among retail investors. On Stocktwits, sentiment toward XPEV turned from 'neutral' to 'bullish' (71/100). Message volume also surged, reflecting increased interest in the stock.

Xpeng’s stock has dropped over 50% this year as the company struggles with weak domestic demand and protectionist tariffs in Europe.

Earlier this month, Xpeng reported weaker-than-expected revenue, though it did manage to narrow its losses thanks to a deal with Volkswagen.

However, some challenges remain for the company. Last week, several Wall Street analysts lowered their price targets for the stock, citing concerns like lower free cash flow projections, a slight miss in Q3 delivery guidance, and anticipated higher spending in the second half of 2024 for new model production.

China, the world’s largest market for new cars and EVs, remains crucial for Xpeng. In recent months, nearly half of all new cars sold in China were electrified, highlighting the market’s potential but also the fierce competition Xpeng faces.