XPeng (XPEV) is in the spotlight after unveiling its AI-defined P7+ sedan in Europe, pairing in-house Turing chip architecture with its VLA 2.0 autonomous driving platform and European production for 25 planned markets.

Despite the recent P7+ headlines and AI push, XPeng’s latest 1-year total shareholder return of 33.33% contrasts with a softer 90-day share price return of a 5.84% decline, suggesting that earlier momentum has cooled for now.

If you are looking beyond XPeng for other EV names, this could be a useful moment to scan auto manufacturers for more ideas in the auto space.

With XPeng shares up 33.33% over the past year but easing 5.84% over the last 90 days, and recent AI and Europe news in the mix, investors may be asking whether there is still an entry point here or whether the market is already pricing in future growth.

Most Popular Narrative: 29.2% Undervalued

XPeng’s most followed narrative puts fair value at US$28.24 per share versus the last close at US$20.00, anchoring a clear valuation gap for readers to weigh against the growth story behind its AI and global expansion plans.

The analysts have a consensus price target of $26.291 for XPeng based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $33.26, and the most bearish reporting a price target of just $18.27.

Curious what earnings path and margin shift could support that higher fair value and price target spread, all discounted at 11.52%? The full narrative lays out an earnings and revenue ramp, plus a future profit multiple, that many investors usually associate with more mature global brands. Want to see which assumptions need to line up for that story to hold together?

Result: Fair Value of $28.24 (UNDERVALUED)

However, you also need to weigh ongoing net losses and intense EV price competition in China, which could pressure margins and delay the profit path behind that upside case.

Another View: Pricing Looks Full On Sales

That 29.2% upside story leans heavily on future earnings and margins. On today’s numbers, XPeng trades on a P/S of 1.9x, above the US Auto industry at 0.8x and its own fair ratio of 1.6x, while only modestly below peers at 2.1x. Is the market already paying up for the AI and growth pitch?

Build Your Own XPeng Narrative

If you look at the numbers and reach a different conclusion, or simply prefer to test your own assumptions, you can build a personalised XPeng thesis in just a few minutes with Do it your way.

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding XPeng.

Ready to uncover more stock ideas?

If you stop at XPeng, you could miss other opportunities that fit your style, so put a few minutes into checking what the wider market is offering right now.

• Scan for potential value in out of favor names by checking these 3528 penny stocks with strong financials that pair lower share prices with stronger underlying financials.
• Focus your research on future facing themes by reviewing these 24 AI penny stocks that connect artificial intelligence with earnings potential and business momentum.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.