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XPeng, VinFast, Hostess Brands: Trending Stocks

Chinese EV maker XPeng (XPEV) signs a $744 million development deal with ride-share giant Didi (DIDIY). VinFast (VFS) shares have extended gains since its IPO debut two weeks ago. Hostess Brands (TWNK) is reportedly exploring a sale amid takeover interest from General Mills (GIS), Mondelez International (MDLZ), PepsiCo (PEP), and Hershey (HSY). Yahoo Finance Live takes a look at some of the leading industry headlines after Monday's closing bell.

Video transcript

SEANA SMITH: XPeng, the stock, closing up just about 5%. Now the company announcing a $744 million deal with Didi. And the Chinese car maker is now going to work on an electric car for launch next year. That's a partnership here with the Didi. And that's going to give obviously you would think XPeng a little bit more exposure.

This is going to be cars, Akiko, targeting the mass market. Maybe the thought here is also it could potentially help some of those investor concerns that we know it is a very, very competitive EV landscape within China right now. Obviously, lots of competition, but XPeng reaching this deal with Didi maybe it'll give them a leg up, maybe a bit of an edge against some of their competitors within the space.


AKIKO FUJITA: Yeah. I mean, it really points to just so how hyper competitive that market is becoming over in China. You talk about this new launch or new mass market vehicle. They're looking at launching a roughly 20,500 or 20,600 I should say is the price tag. So at a lower price point, as they look at where the market is right now, remember XPeng also took some investments in from Volkswagen. Took a 5% stake in the company as well.

To me, the interesting part is the partnership on the other side, which is Didi. As you know, this ride hailing company was at one point, trying to develop their own robotaxis and EVs. But as we know, since the IPO, things have been very bumpy for this company. So we'll see how this all fares. But XPeng getting a lift on the back of that.

Well, sticking with the electric vehicle market, VinFast shares riding higher and now the company has a bigger market cap than yes, Ford, General Motors, and Stellantis combined. Seana, combined. And remember, we were talking about this company, Vietnamese company that is really boldly trying to compete in the US market at a lower price point.

I mean, guess there is an argument to be made that because of the limited number of shares that are trading, things have been a little choppy or a little more exaggerated in terms of the moves. But it has been an incredible run in a very short amount of time. I don't know.

It's hard to say where this is all going to go because we have seen what happens-- what has happened in the past at least with some of these SPACs, these upstart EVs that have come to market through SPAC.

SEANA SMITH: Yeah. Akiko, we also have to keep in mind this is a money losing EV startup right there. Certainly, is a lot of excitement. I think you're exactly right to point out the fact that it's a very, very, very small amount of shares that are available right now. So that leaves this stock prone to wild swings to volatility.

We certainly have seen that play out since it did go public earlier this month. But we can take into account the valuation, near $200 billion, like you said, more than many of the large automakers combined, certainly looks a bit out of step with the fundamentals when you take a look at this business, it certainly has attracted retail investor attention.

I was looking today, it's one of the most watched names on Stocktwits, so it really points maybe to some of the volatility in the wild swings that we have seen within the space and that maybe no surprise that is then attracting some interest from retail traders.

But the fact that this is now what, the third largest automaker in the world behind Toyota and Tesla, it's pretty incredible. I don't think many people would have expected that when it went public.

AKIKO FUJITA: No, Seana, by the way, it's worth noting in terms of numbers of VinFast EVs, just 137 registered cars in the US. Obviously, they're going for scale in the US. But, I mean, for a car company that is valued at what it is, pretty incredible.

SEANA SMITH: Yes, certainly incredible. We'll see likely a lot of volatility ahead you would think in that name.

All right. Well, we are also watching shares of Hostess Brands. The stock jumping on a report that the company is considering putting itself up for sale. Reuters saying that it's fielding takeover interest and among those interested-- General Mills, Mondelez International, PepsiCo, and Hershey. We're looking at gains of just about 2%. And also some analysts, Akiko, weighing in today.

Evercore's David Palmer saying that on a possible deal. Maybe it would be attractive for some of the other players that we just mentioned there. They have a sustainable, profitable growth. Relatively attractive sweet baked goods category. So this could be an attractive target for some of the larger names within this space. And we know Hostess Brands has been struggling with its business now for over a decade.

AKIKO FUJITA: I know we're talking about the business side of things for Hostess, but I mean, you know, I was thinking about this story. I can't remember the last time I had a Twinkie.


AKIKO FUJITA: And I have been told by those like Brooke DiPalma that the quality is much, much better now. But I don't know. I have not tried one in years. So

SEANA SMITH: I was going to say, I think there's a word for that. I don't know if I'm buying it, though.

AKIKO FUJITA: Yeah. I mean, obviously a Twinkie or Hostess, I should say, looking for other buyers in the market. We're going to be watching that space really closely. It'll be interesting to see how this all shakes down.