As XPeng's August deliveries soar 172%, is it time to invest?

On Wednesday, Xpeng Inc. (NYSE:XPEV) shares plunged nearly 4% despite posting an impressive 172% year-over-year increase in August deliveries. The company shipped 7,214 vehicles last month, boosted by 209% Y/Y P7 EVs delivery growth to 6,165 units.

However, the 7,214 shipments still dwarfed July’s deliveries of 8,040 by 10%, indicating a sequential slowdown. On the other hand, year-to-date deliveries increased by 334% to 45,992 compared to the same period last year.

Xpeng plans to begin delivering the G3i models in September after transitioning from G3 in August. Moreover, the company will officially launch its P5 model on 15th September. Therefore, Xpeng has exciting times ahead.

Xpeng does not appeal to value investors

From a valuation perspective, Xpeng shares seem expensively valued at a price-sales ratio of 20.57, making them less attractive to value investors. In addition, analysts expect its bottom line to decline by 4.30% this year before falling at an average annual rate of about 5.81% over the next five years, amid continued investment in the product line.

Therefore, growth investors could also opt for alternatives while monitoring developments in Xpeng. As a result, it may not be best to buy Xpeng shares now, ahead of a tricky period.

Furthermore, shares are still 90% up over the last 12 months despite falling by nearly 7% this year.

Xpeng shares appear to be facing solid trendline resistance

Technically, Xpeng shares seem to be trading within a gently descending channel formation in the intraday chart. However, the stock recently bounced off the 100-day moving average before finding solid trendline resistance.

As a result, Xpeng shares appear poised for an inevitable pullback. Therefore, investors can target potential pullback profits at approximately $38.04 or lower at $33.70. On the other hand, $45.50 and $49.10 are crucial support levels.

Bottom line: It may be time to short Xpeng stock

In summary, although Xpeng shares seem to have recently bounced off the key moving average indicator, the stock appears to have found resistance off the trendline.

Moreover, Wednesday’s pullback despite delivering strong year-over-year growth in EV deliveries indicates that investors are looking for more catalysts for growth.

Therefore, it may be best to wait for Xpeng shares to retest current support levels before buying to profit from the rebound.