Tesla Cooling Off, XPeng Heating Up: Which EV Stock Wins Your Vote?
Meanwhile, XPeng, Inc. XPEV — a rising EV star from China — is making serious waves. Backed by a surge in China's new energy vehicle (NEV) sales and strong government support, XPeng is delivering rapid growth and rolling out its own AI-driven innovations. And while Tesla grapples with a potentially tougher U.S. regulatory environment, including the looming end of the $7,500 EV tax credit, XPeng's momentum is building fast.
Year to date, XPeng stock has surged 55%, trouncing Tesla's performance. The question is whether investors should stay with the EV pioneer or bet on the fast-rising tech-savvy challenger?
The Case for Tesla
Tesla might still be the first name that pops into your mind when we talk about EVs, but cracks are starting to show. After years of strong growth, Tesla's deliveries are now heading in the wrong direction. In 2024, the company posted its first-ever annual drop in deliveries. That slump has continued into 2025, with sales falling 13% year over year in the first quarter and another 13.4% in the second quarter of 2025. Europe has been a particularly weak spot, but demand has cooled in other markets too. Tesla faces a real chance of delivering fewer vehicles in 2025 than it did in 2024. That would mark a second straight year of declining sales.
Tesla hasn't released a new mass-market model in years. While competitors are flooding the market with fresh EVs at various price points, Tesla's lineup is starting to feel dated. Add in rising competition from both dedicated EV makers and traditional automakers, and Tesla's once-dominant market position is slipping. Musk's public image isn't helping either. His political posts and unpredictable behavior are turning off some potential buyers.
Tesla's big swing to reignite excitement—the robotaxi—hasn't landed quite right either. The service launched in a limited test in Austin last month, but reports suggest it's still very much a work in progress. Technical hiccups and the need for human safety drivers make it clear that fully autonomous rides are still some distance away.
Tesla's energy and charging businesses are bright spots, but they're not yet big enough to carry the company. For now, Tesla needs to prove it can revive its core auto business before its rivals pull too far ahead.
The Case for XPeng
XPeng may not have Tesla's size or global brand power, but it's quickly earning its place in the EV spotlight. The Chinese EV maker is scaling fast—and smart. It's not just selling more cars; it's building them around intelligence-driven features that appeal to the tech-savvy buyer.
Take the new G7, for example—a sleek crossover that fits right between XPeng's G6 and G9 models. But it's not just about filling a lineup gap. The G7 is the first vehicle powered by XPeng's own Turing AI chip, which boasts triple the computing power of typical smart driving chips. That gives it a real edge in self-driving capability. Launched in China, the G7 undercuts Tesla's Model Y by nearly $9,500, and early sales suggest it's a serious competitor.
XPeng's delivery numbers are turning heads too. In 2024, it delivered over 190,000 vehicles, up 34% year over year. That growth has exploded in 2025. In just the first quarter of 2025, XPeng delivered 94,008 vehicles—a massive 331% jump from the same period a year ago. The momentum continues. Last month, XPeng delivered 34,611 smart EVs, marking a whopping 224% increase year over year. With that, XPeng's deliveries surpassed the 30,000 mark for the eighth straight month. In the three months ending June 2025, it sold a record 103,181 cars, more than double its second-quarter 2024 levels.
The company is innovating fast. From its AI-powered Hawkeye Vision System to its XOS 5.4 operating system, XPEV is all-in on full-stack smart driving. It's even dabbling in futuristic tech like flying cars and humanoid robots. XPeng may still be the underdog, but it is quickly becoming one of the most exciting EV players to watch.
How Do Estimates Compare for XPEV & TSLA?
The Zacks Consensus Estimate for XPeng's 2025 top and bottom line suggests year-over-year improvement of 102% and 67%, while the 2026 sales and earnings estimate implies a jump of 39% and 207%, respectively, from 2025 projected levels. See how estimates for XPEV have been revised in the past 90 days.
The Zacks Consensus Estimate for Tesla's 2025 top and bottom line suggests year-over-year decline of 3.7% and 27%. However, its 2026 sales and earnings estimate implies growth of 18% and 51%, respectively, from 2025 projected levels. See how estimates for TSLA have been revised in the past 90 days.
Conclusion
While Tesla still commands global attention, its momentum is clearly slowing. Falling deliveries, fierce competition, and a shaky start to its robotaxi ambitions have cast a shadow over its growth story. Tesla's downward EPS estimate revisions and its Zacks Rank #4 (Sell) reflect the challenges it is facing.
XPeng, in contrast, is gaining speed—delivering record-breaking numbers, showcasing advanced tech, and riding strong tailwinds in China's booming EV market. With positive EPS estimate revisions and solid growth outlook, XPeng is quickly proving it's not just a rising star, but a serious player.
XPeng, with a Zacks Rank #2 (Buy), is clearly the more attractive pick in today's EV landscape.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here
One Big Gain, Every Trading Day
To help you take full advantage of this market, you're invited to access every stock recommendation in all our private portfolios - for just $1.
Zacks private portfolio services that closed 256 double and triple-digit winners in 2024 alone. That's about one big gain every day the market was open. Of course, not all our picks are winners, but members have seen recent gains as high as +627% +1,340%, and +1,708%.
Imagine how much you could profit with a steady stream of real-time picks from all our services that cover a number of strategies to suit a variety of investing and trading styles.
See Stocks Now >>
Tesla, Inc. (TSLA): Free Stock Analysis Report
XPeng Inc. Sponsored ADR (XPEV): Free Stock Analysis Report
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Winnipeg Free Press
an hour ago
- Winnipeg Free Press
Modi joins Maldives independence day celebrations, signals easing tensions amid China rivalry
COLOMBO, Sri Lanka (AP) — Indian Prime Minister Narendra Modi Saturday participated Saturday in the 60th Independence Day celebrations of the Maldives, concluding a two-day visit to the island nation. During the trip, Modi also announced financial assistance and formally launched talks on a proposed free trade agreement. The two-day visit was seen as crucial to India's ambition to control the seas and shipping routes of the Indian Ocean in a race with its regional rival China. It signaled a thaw in diplomatic tensions that followed the election of pro-China Maldivian President Mohamed Muizzu in 2023. Modi joined a distinguished gathering at Republic Square in the capital, Malé, where a military parade and cultural performances marked the anniversary of the Maldives gaining independence from British rule in 1965. On Friday, following talks with Maldivian President Mohamed Muizzu, Modi announced a credit line of $565 million to support development projects in the Maldives. The visit coincided with the anniversary of the establishment of diplomatic ties between the two nations in 1965. It also saw the start of talks on a free trade agreement. The two leaders oversaw the exchange of signed agreements to cooperate in sectors such as fisheries, health, tourism and digital development. Modi also handed over dozens of heavy vehicles donated by India to strengthen the Maldives' defense forces. The Maldives — an archipelago nation strategically located in the Indian Ocean — is a focal point in the growing geopolitical rivalry between India and China. Tensions grew when Muizzu, who favored closer ties with China, was elected in 2023 after defeating the India-friendly incumbent Ibrahim Mohamed Solih. Leading up to the election, Muizzu had promised to expel Indian soldiers deployed in the Maldives to help with humanitarian assistance. Last year New Delhi replaced dozens of its soldiers in the Maldives with civilian experts. Monday Mornings The latest local business news and a lookahead to the coming week. Measures by Modi to promote tourism in India's Lakshadweep archipelago, off the southwestern coast of the Indian mainland, also sparked anger from Maldivians, who saw it as a move to lure Indian tourists away from their country. Indian celebrities then called for a tourism boycott of the Maldives. Tensions escalated last year when President Muizzu visited China before India, a move widely interpreted in New Delhi as a diplomatic snub. On his return, Muizzu outlined plans to reduce the Maldives' reliance on India for medical services, pharmaceuticals, and essential imports such as food staples. Relations started to improve after Muizzu attended Modi's swearing-in ceremony for a third five-year term last year. Muizzu has since toned down his anti-Indian rhetoric, and official contacts with New Delhi have intensified amid growing concern about the Maldives' economy. During a visit by Muizzu to India last October, India pledged financial support to the Maldives, which has been struggling with debt. This included $100 million in short-term government loans and agreeing to a $400 million currency swap to help stabilize the Maldivian economy. India has long been a key development partner for the Maldives. However, the island nation has also deepened ties with China, joining its Belt and Road Initiative in 2013 to build infrastructure and expand trade — part of Beijing's broader effort to increase its global influence.
Globe and Mail
an hour ago
- Globe and Mail
Alphabet Just Gave Nvidia Investors Some Great News
Key Points Alphabet now expects to lay out $85 billion in capital expenditures this year -- up from a previously planned $75 billion -- and expects to further accelerate that spending next year. Alphabet's AI capex will be allocated toward servers, accelerated data center buildouts, and cloud computing infrastructure. Rising AI infrastructure spending from hyperscalers such as Alphabet bodes well for Nvidia and its thriving GPU business. 10 stocks we like better than Nvidia › Over the next several weeks, companies will report financial and operating results for the second quarter of 2025. As usual, technology investors will be focused on one thing: artificial intelligence (AI). "Magnificent Seven" member Alphabet kicked things off earlier this week, reporting robust results across its search, advertising, and cloud computing divisions. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » While Alphabet shareholders should be encouraged by the internet giant's strong performance, I saw Nvidia (NASDAQ: NVDA) as the real winner from the company's second-quarter performance. Let's dig into some of the important moves Alphabet is making and assess how Nvidia is benefiting from them. Alphabet is picking up the pace on AI infrastructure construction During the Q2 earnings call, Alphabet's management updated some details of its financial guidance. Alphabet now plans to spend around $85 billion on capital expenditures (capex) in 2025. Of note, this is a $10 billion increase over the company's prior guidance. And there's more. "Looking out to 2026, we expect a further increase in capex due to the demand we're seeing from customers as well as growth opportunities across the company," said Chief Financial Officer Anat Ashkenazi. Despite its increasingly aggressive spending on AI infrastructure over the last few years, Alphabet has stated that it doesn't plan on slowing down anytime soon. This should be music to Nvidia's ears. GOOGL Capital Expenditures (TTM) data by YCharts. Why is this good for Nvidia? Management consulting juggernaut McKinsey & Company is forecasting that AI infrastructure spending could reach $6.7 trillion by 2030. And its research suggests that almost half of that money will be allocated toward AI hardware for further data center construction. In addition, research from Goldman Sachs and JPMorgan indicates that generative AI could add between $7 trillion and $10 trillion to global gross domestic product in the long run. From a macroeconomic perspective, these secular trends bode well for Nvidia's compute and networking empire. Moreover, I think that Alphabet's decision to bump up its AI infrastructure spending again adds some credibility to those industry forecasts. Alphabet's management specified that it is raising its planned capex in order to accelerate the construction of data centers and position itself to fill the rising demand for capacity on the Google Cloud Platform. Increased spending on network equipment, servers, and cloud infrastructure should lead to rising demand for graphics processing units (GPUs). I see this as a major positive development as Nvidia is still scaling up production of chips made using its latest Blackwell architecture. Considering Nvidia holds an estimated 90% share of the data center GPU market, I see Alphabet's investments in AI infrastructure as a major tailwind for the chip king and further propels the company's momentum over competition in the chip space. Is Nvidia stock a buy right now? With a market cap north of $4.2 trillion, Nvidia is currently the most valuable company in the world. While this might lead one to assume that the stock is expensive, its underlying valuation trends tell a different story. NVDA PE Ratio (Forward) data by YCharts Nvidia currently trades at a forward price-to-earnings (P/E) multiple of 40. While this isn't "cheap" by traditional benchmarks, it is notably lower than the peak levels Nvidia has witnessed during the AI revolution. What makes these dynamics interesting is that Nvidia's growth trajectory is arguably far stronger today than it was 18 months ago when its forward P/E valuation peaked. The company remains at the center of the AI revolution, providing massive amounts of fast parallel-processing power to hyperscalers and accelerating AI workloads. To me, buying Nvidia stock at its current price is a no-brainer, and I see Alphabet's rising AI infrastructure spending as a long-term catalyst that should not be overlooked by growth investors. Should you invest $1,000 in Nvidia right now? Before you buy stock in Nvidia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,063,471!* Now, it's worth noting Stock Advisor's total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025
Globe and Mail
an hour ago
- Globe and Mail
1 Reason to Buy Visa (V)
Key Points Visa is a high-quality business whose shares rarely go on sale, but that might not discourage investors from owning the stock. The company's competitive position is supported by the presence of a powerful network effect. Stablecoins have an uphill battle to put a dent in Visa's business model. 10 stocks we like better than Visa › Visa (NYSE: V) is a dominant force in the financial services industry. It runs a leading payments platform that connects consumers, banks, and merchants across the globe. The business even finds itself in Warren Buffett-led Berkshire Hathaway 's portfolio. This financial stock trades close to all-time highs, and a valid argument can be made that the current valuation isn't cheap. But this is an outstanding company that still deserves a closer look. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » Here's one reason investors should buy Visa. Visa's unassailable competitive position In fiscal 2024, Visa processed 233.8 billion transactions valued at a whopping $15.7 trillion. It currently has 4.8 billion active cards that are accepted at 150 million merchants around the world. That scale is unmatched, and it demonstrates just how formidable Visa's competitive position is, which is a key reason to scoop up shares. The business benefits from an extremely powerful network effect. As the number of merchants that accept Visa grows, it's more valuable to have a Visa card. The opposite is also true, with more cardholders creating more sales opportunities for merchants. The threat of stablecoins With the passing of the Genius Act, investors might start to worry about the threat that stablecoins pose to Visa's business model. As things stand today, there's no reason to be concerned. While merchants will test the waters in an effort to cut payment processing costs, the real question of whether or not consumers will make the jump. Favorable legislation passing doesn't necessarily mean there will be mass adoption of stablecoins. People love their credit cards and the perks and rewards they offer. And a company like Visa is so ingrained in our economy, with the network effect already mentioned, as well as its deep relationships with banks and other players in the financial services industry, that it's a monumental task to disrupt it. Visa should continue to dominate the payments landscape for the foreseeable future. Should you invest $1,000 in Visa right now? Before you buy stock in Visa, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Visa wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,063,471!* Now, it's worth noting Stock Advisor's total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025
