Is XPEL a good stock to buy? We came across a bullish thesis on XPEL, Inc. on Capital Light’s Substack by Luke Wolgram. In this article, we will summarize the bulls’ thesis on XPEL. XPEL, Inc.’s share was trading at $38.74 as of March 20th. XPEL’s trailing P/E was 20.97 according to Yahoo Finance.
XPEL, Inc. manufactures, installs, sells, and distributes protective films, coatings and related services. XPEL presents a compelling growth story driven by both top-line expansion and margin improvement. The company is expected to grow revenue by 13% in 2025, followed by a 10% annual increase from 2026 through 2029, tapering to 5% in 2030, slightly above market expectations of roughly 10% growth. Management has highlighted the potential for gross margins to expand to 50-52% by 2030 through in-house manufacturing, reflecting operational leverage that enhances profitability.
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Operating expenses are being carefully managed, with Sales and Marketing spending gradually rising to 11% of revenue while General and Administrative costs decline from 18% to 16% of revenue over the same period. Depreciation and amortization are projected at 3% of revenue, CAPEX at 2.5%, and net working capital changes at 3%, supporting steady cash flow generation.
Based on these assumptions, XPEL’s earnings per share are expected to increase from $2.47 in 2026 to $5.25 by 2030, representing a 16% CAGR, while free cash flow grows from $56.3 million to $128.7 million, an 18% CAGR. The resulting discounted cash flow analysis assigns a fair equity value of $54.32 per share, implying upside potential relative to the current market price if the company outperforms consensus revenue growth expectations while maintaining or improving margins. With a modestly increasing share count reaching 27.8 million by 2030, XPEL’s capital structure remains manageable, supporting sustainable growth. Overall, XPEL offers an attractive risk/reward profile, combining durable revenue growth, margin expansion, and strong free cash flow generation, making it a strategically appealing investment for shareholders seeking both growth and value realization.
Previously, we covered a bullish thesis on XPEL, Inc. (XPEL) by Reasonable-Green-464 in January 2025, which highlighted the company’s brand strength, product diversification, international expansion, and partnerships with Tesla and Rivian. XPEL’s stock price has depreciated by approximately 10.65% since our coverage as primarily following a Q4 2025 revenue miss and weaker-than-expected Q1 2026 guidance. Luke Wolgram shares a similar view but emphasizes projected revenue growth and margin expansion through 2030 with in-house manufacturing and cost discipline.
XPEL, Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 21 hedge fund portfolios held XPEL at the end of the fourth quarter which was 24 in the previous quarter. While we acknowledge the risk and potential of XPEL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than XPEL and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
