BYD, First Hydrogen, XPeng - When will the rebound follow?

BYD - Analysts set the tone

So far, the current stock market year has been disappointing for the new global market leader in electric vehicles, although BYD has celebrated a promising comeback in recent weeks. The shares of the Company, co-financed by Warren Buffett, plummeted by around 35% to an annual low of USD 21.80 by the beginning of February before the stock could recover significantly to its current level of USD 27.30. The bottom line for the Shenzhen-based company is a loss of 3.5%.

If Citigroup analysts have their way, the share price is likely to change quickly. That is because they predict that the recent decline in sales could end this month. Expressed in figures, the experts estimate deliveries of 320,000 electric vehicles and have, therefore, issued a price target of the equivalent of USD 57.57.

Strategically, BYD intends to continue its expansion, especially in Europe. Since the third quarter of 2022, the technology group has already launched several models in 20 European countries, including Germany, the UK, Spain, Italy, France, the Netherlands, Norway and Hungary. A new target market has now been found in Greece. BYD plans to launch two models there, the Yuan PLUS (BYD ATTO 3) and the Seal.

First Hydrogen - Continues with record figures

The hydrogen innovator First Hydrogen, based in Vancouver, Montréal and London, is currently presenting a contrasting picture. While the tests of light commercial vehicles powered by hydrogen fuel cells are delivering one record after another, the share price cannot escape the pull of the general market correction in the hydrogen sector. Since January 2023, First Hydrogen shares have lost around 75% of their value to the current CAD 1.20, similar to the market leaders in the sector. For weeks now, however, the aforementioned shares have been forming a sustainable floor that could herald the next upward wave in this future technology. In the case of First Hydrogen, the rebound could be significant. After the trend following indicator formed a double divergence since April 2023, the stock could react in the first wave up to the CAD 2.00 area.

From a strategic perspective, everything is going according to plan. The tests under real road conditions were successfully completed with gas network operator Wales & West Utilities, which operates 1,300 fleet vehicles and supplies gas to more than 7.5 million customers. During the four-week field tests, in which more than 2,000 km were covered in sub-zero temperatures, the light commercial vehicles impressed the test drivers.

It was possible to analyze that the vehicle performance and range do not decrease even at colder temperatures. On the contrary, the prototype demonstrated suitability for demanding tasks such as transporting heavy payloads, towing and powering auxiliary equipment such as onboard power, and the full performance of the fuel cell module with an output of more than 60 kW during short-term accelerations.

Steve Gill, Executive Director Automotive at First Hydrogen, was delighted with the positive tests: "We are thrilled with the feedback from Wales & West Utilities. Having covered more miles in this single test run than ever before, we have gathered a significant amount of vehicle data."

XPeng - Attacking the low for the year

In contrast to the leader in the Chinese market, BYD, the much smaller electric vehicle manufacturer and partner of Volkswagen has not yet been able to recover from the correction that has been ongoing since the beginning of the year. Since January 1, XPeng shares have lost more than 40% of their value and are making great strides towards the annual low of USD 7.80 reached in February. Falling below this level would generate a new sell signal. The next marked support area would be USD 6.18.

The figures reported by the Guangzhou-based company last week contributed to the further fall in the share price. The Company delivered 141,601 electric vehicles in 2023, representing a year-on-year increase of 17.3%. Revenue increased in line with the rise in deliveries, up 14.2% to EUR 3.98 billion on the previous year.

In the fourth quarter alone, sales amounted to 60,158 units due to a product offensive and the expansion of the model range, an increase of 171% compared to the final quarter of the previous year. However, investors were negatively affected by the also increased loss, which grew by 13.5% to now EUR 1.35 billion.

BYD recovered from the share price losses in the first month of the year and now wants to expand further in Europe. In contrast, competitor XPeng is close to its low for the year after widening its annual loss. First Hydrogen successfully completed another test of its light commercial vehicles.