Price Forecast:

Bullish Case: XPeng's partnerships and robust sales in China's EV market, paired with innovative product launches, suggest potential for future revenue growth, possibly leading to a rebound in stock value.

Bearish Case: Continued financial losses, fierce competition, and potential trade barriers in Europe may hinder XPeng's growth, risking further valuation declines as market sentiment worsens.

Potential Outcomes:

• 40% chance: Successful integration of VW and Didi partnerships boosts revenue.
• 35% chance: Ongoing financial struggle leads to decreased market share.
• 20% chance: Entry barriers in Europe due to tariffs limit expansion efforts.
• 5% chance: Regulatory changes positively impact XPeng’s competitive positioning.

Trading Oracle: Consider a short-term bullish approach with a 12.50/$13.50 call spread, capitalizing on recent volatility spikes with premium capture before expiry. Given positive sale trends, target a 12-20% gain within 60 days while managing downside risk with protective stops.

November 22, 2024