Earnings Doubts Reign as BYD Stock Set for Fifth Month of Losses

Core Viewpoint - BYD Co. is experiencing significant declines in its stock price, leading to skepticism about its competitive position in the Chinese electric vehicle market [1][2]. Group 1: Stock Performance - BYD's Hong Kong-listed shares are on track for their longest streak of monthly declines since 2018, with a 32% drop from a peak in May, resulting in a loss of over $45 billion in market value [1][2]. - The number of outstanding options contracts for BYD shares has exceeded 650,000, approaching record levels seen before the September expiration [4]. Group 2: Sales and Market Position - BYD delivered approximately 1.1 million cars in the three months ending September, reflecting a 1.8% decrease compared to the same period last year [2]. - Analysts project that BYD's quarterly sales will show a 7.4% increase, marking the slowest growth rate since early 2024 [2]. Group 3: Competitive Landscape - Increased vehicle sales from competitors such as Geely Automobile Holdings Ltd. and Zhejiang Leapmotor Technology Co. have raised concerns about BYD's ability to maintain its leading position in the electric vehicle sector [2]. - Analysts from Morgan Stanley noted that while there may be margin improvements from reduced promotions and dealer rebates, an unfavorable product mix could offset these gains [3].