: XPeng stock rockets to record rally as bulls brush off bad results, outlook

The rally comes even after XPeng reported a wider-than-expected loss for the third-straight quarter, missed on revenue for the first time and said it expected fourth-quarter revenue to fall 40% to 44% from a year ago while the FactSet consensus called for just a 4.4 decline.

Instead, investors seemed China appeared to move toward easing its zero-COVID policy, amid growing social unrest and a slowing economy. China’s government said Tuesday that it would renew its push to vaccinate the elderly, and said it would amend COVID control measures.

XPeng’s stock rally also comes at a time when investor sentiment had soured. Earlier this week, Jefferies analyst Johnson Wan downgraded the EV maker, citing recent “missteps” by the company at a time that the “honeymoon stage” for EVs in China was coming to an end.

In addition, short interest, or bearish bets on XPeng’s stock, was 5.7% of the public float, or freely tradable shares, based on the latest available exchange data. That compares with short interest as a percent of float for China-based rivals Nio Inc.
NIO,
+21.71%
at 4.1% and Li Auto Inc.
LI,
+18.73%
at 4.7%.

For Tesla Inc.
TSLA,
+7.67%,
which generated $5.13 billion in revenue from China in its latest quarter, or about 24% of total revenue, short interest as a percent of float was 2.9%.

XPeng’s stock soared 63.3% in November but has still tumbled 37.6% over the past three months. In comparison, the Invesco Golden Dragon China exchange-traded fund
PGJ,
+9.59%
has shed 10.9% the past three months while the S&P 500 index
SPX,
+3.09%
has gained 2.9%.