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The Chinese EV maker Xpeng priced its initial public offering at $15 a share Wednesday evening, and the stock opened for trading at $23.10, up 54% from the IPO price.
Barron’s suggested the stock could open 20% higher. We were too conservative. Shares hit $25, up 67%. They closed at $21.22, up 41%.
Being wrong about EV stocks in 2020, however, isn’t surprising. All things EV are on fire. The EV stocks Barron’s tracks are up roughly 320% year to date. Tesla (ticker: TSLA) shares rose another 4% Thursday to $2,238.75 bringing their year-to-date gain to roughly 435%.
Those numbers are only part of the story. EV stocks such as Li Auto (LI) and Xpeng (XPEV) don’t have full-year trading histories, but their shares are soaring too.
Tesla—with a market value of more than $400 billion—is the sun other EV companies revolve around. Thursday’s opening trades value Xpeng at, very roughly, $17 billion. The Thursday closing valuation is closer to $15 billion.
Xpeng peers Li Auto and NIO (NIO) are valued at roughly $16 billion and $24 billion, respectively. U.S. alternative-fuel-vehicle companies are worth less.
Fisker, which is being bought by Spartan Energy Acquisition (SPAQ), is valued at around $4 billion. Canoo, being purchased by Hennessy Capital Acquisition (HCAC), is valued at around $3 billion. Lordstown Motor, which is being snapped up by DiamondPeak (DPHC), is valued, very roughly, at between $2 and $3 billion.
The U.S. shares look like a bargain, but the Chinese players—Li, Xpeng and NIO—have sales. Fisker, Canoo and Lordstown don’t sell vehicles yet. That’s one big difference.
Li and NIO shares closed down 17.1% and 2.7%, respectively, in Thursday trading. Downward moves are surprising for EV stocks these days, but Li and NIO are up about 21% and 66% month to date, respectively.
The Dow Jones Industrial Average closed Thursday up 0.6%, while the S&P 500 gained 0.2%.
Whether the valuations of EV companies represent a good deal for investors is hard to say. The gains have been amazing, and to some extent, the rally is feeding on itself. Investors will need to see big sales growth and improving profit margins to keep the momentum high for EV stock prices.
Corrections & Amplifications: Stock in XPeng opened at $23.10, 54% above its IPO price of $15. An earlier version of this article said the stock opened at $24, for a 60% gain.
Write to Al Root at allen.root@dowjones.com