BYD Co Ltd BYDDY has delivered an impressive performance, with its stock surging nearly 70% over the last 12 months. This strong upward move has sparked a debate among investors — is the rally signaling lasting strength, or could it be time for expectations to level off? To get a clearer view, it’s worth digging into BYD’s strategy, financials, competitive landscape, and broader market dynamics to determine whether the Chinese EV and battery powerhouse remains a smart investment at this stage.

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BYD’s Market Momentum and Strategic Dominance

BYD is not just growing; it’s accelerating. In 2023, the company sold over three million new energy vehicles (NEVs), reflecting a massive 62% year-over-year jump. It capped off the year by overtaking Tesla TSLA in the final quarter, selling 526,409 battery EVs versus Tesla’s 484,507. This momentum carried into 2024, with the Warren Buffett-backed firm setting a new record, selling over 4.27 million NEVs.

BYD now commands a third of China’s NEV market and holds the largest EV market share in the country, outpacing peers like Li Auto LI. In the first three months of 2025, BYD delivered 416,388 battery electric vehicles (BEVs), surpassing Tesla’s 336,681 units for the same period. This marked the second straight quarter that BYD has held the title of the world’s top EV maker. With rapid expansion and cutting-edge technology, BYD continues to challenge Tesla’s longtime dominance. Meanwhile, Li Auto delivered 92,864 units in the first quarter of 2025.

BYD’s global footprint is expanding rapidly. It now sells in over 70 countries and is set to launch localized production in Thailand, Brazil and Hungary. These moves provide a multi-region growth engine beyond China. With its focus on vertical integration—from battery manufacturing to semiconductors and vehicle assembly—the company enjoys tight cost control, a competitive edge in an increasingly price-sensitive EV market.

BYD’s Innovation, Profit Growth and an Upbeat Outlook

While Tesla gets most of the press for innovation, BYD has quietly built one of the most vertically integrated supply chains in the EV world. Its proprietary Blade Battery—lauded for its safety and longevity—is used across its product lineup, including its premium Yangwang and Denza sub-brands. This in-house battery advantage has shielded BYD from external supply shocks and raw material price swings better than most. 

Compare this to Tesla, which still depends heavily on third-party battery suppliers, especially for its China-made models. While Tesla has made strides in developing its 4680 battery cells, BYD's end-to-end control—down to chips and semiconductors—offers it unique flexibility in cost management and vehicle customization. This, coupled with abundant labor in China and strategic moves, helped it grow net profit from RMB 30.04 billion in 2023 to RMB 40.25 billion in 2024, a 34% increase. Meanwhile, revenues climbed 29% to a record 777.1 billion yuan ($107 billion). 

The future also looks bright. According to the Zacks Consensus Estimate, BYD’s earnings are projected to rise by 32.7% in 2025, followed by a further 19.1% in 2026. That said, Tesla remains more profitable per unit and commands a premium brand image globally—two areas where BYD is still catching up.

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BYD’s Game-Changing Breakthrough

BYD is not just riding a sales wave—it’s also innovating at a remarkable pace. With its new "Super e-Platform," BYD is taking a huge leap forward in battery technology and charging speed. The company claims that its latest batteries can achieve 400 kilometers (about 249 miles) of range with just five minutes of charging. This could be a massive breakthrough in tackling one of the biggest hurdles to widespread EV adoption—charging anxiety. The new system boasts a peak charging speed of one megawatt, making it the fastest mass-produced system available. If these claims hold up, BYD could be rewriting the rules of EV charging. BYD plans to deploy 4,000 of these platforms in China, significantly enhancing its competitive edge in battery and charging innovation. 

While BYD’s claims are impressive, it isn’t the only company working on ultra-fast charging. Tesla’s latest Superchargers can charge at up to 500 kilowatts, adding 270 kilometers of range in 15 minutes. Li Auto equips one of its vehicles with a battery from Contemporary Amperex Technology, enabling a 500-kilometer range with a 12-minute charge.

Alongside, BYD has introduced “God’s Eye,” an autonomous driving suite that can operate effectively on both highways and urban roads. This dual innovation push—enhancing both core vehicle performance and next-gen features—positions BYD as a technological leader.

Caution Flags: Valuation, Global Risks & U.S. Market Absence

All this good news has not gone unnoticed. BYD’s forward sales multiple has risen to 0.91X, above its median of 0.80X over the past two years. For a company growing as fast as BYD, stretching the valuation against historical averages might be justifiable. Still, any slowdown in margins or sales—especially in the highly competitive Chinese market—could put pressure on the stock.

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Moreover, while BYD’s international ambitions are bold, they are not without risk. In markets like Europe, the Shenzhen-based company faces the threat of tariffs and growing regulatory scrutiny. The EU has already launched investigations into Chinese EV subsidies, which could lead to punitive actions. Meanwhile, competitors like Tesla and even traditional giants such as Volkswagen and Toyota are scaling up their EV efforts in BYD’s backyard and overseas.

Despite its global strides, BYD’s absence from the U.S. market remains a substantial strategic gap. The company continues to steer clear of North America due to high tariffs, trade frictions and political resistance toward Chinese automakers. This limits its addressable market at a time when EV adoption in the United States is gaining traction

Competitive Pressure

Tesla remains BYD’s most visible rival and benchmark. While BYD outsold Tesla in unit terms, Tesla still leads in margins and technology perception. But in contrast to Tesla’s more uniform product strategy, BYD takes a multi-tiered approach by targeting diverse customer segments through distinct sub-brands—from the high-end Yangwang line to the budget-friendly Dolphin series—enabling it to cater to a wide range of consumer preferences.

Another notable player, as previously discussed, is Li Auto. The company has carved out a niche in the extended-range hybrid segment and is gaining ground quickly in the premium SUV category. Yet, BYD’s volume scale and in-house capabilities put it in a more robust position for the long term.

Conclusion: BYD a Hold for Now

BYD has proven that it’s not just another EV maker—it’s a global powerhouse with an efficient, diversified model and strong execution. The surge in stock price reflects well-earned investor confidence, driven by explosive growth and technological innovations. But with rising valuation multiples and global headwinds, the easy money might already be made for now.

For new investors, BYD doesn’t scream "bargain" at these levels. For existing holders, there’s no strong reason to exit either. Keep an eye on global expansion progress and sales momentum sustainability, but for now, the stock carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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