XPeng's stock falls after analyst's 'profit-taking' call ahead of earnings

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XPeng's stock fell Friday after J.P. Morgan recommended investors sell ahead of earnings, as "survival competition" in China's auto market weighs...

Shares of XPeng Inc. took a hit Friday, after J.P. Morgan recommended investors sell ahead of earnings, as there is very little scope for a positive margin surprise given the “survival competition” seen in China’s auto market.

Analyst Nick Lai cut his rating on the China-based electric-vehicle maker to underweight from neutral. While the price target was raised to $10.00 from $7.50, the new target still implies 33.5% downside from Thursday’s closing price of $15.04. Lai said he expects second-quarter gross profit margin to remain weak due to operation deleveraging and a weak product mix, and sees second-half GPM below current Wall Street forecasts.

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