BYD Company (BYDDY 3.02%) stock raced 3% higher through 11 a.m. ET Tuesday after the business passed a significant production milestone — one that puts it head and shoulders above electric vehicle (EV) archrival Tesla (TSLA 2.49%).

As Elecrek reported yesterday, BYD’s car factory in Xi’an, China, just passed 1 million vehicles produced year to date in 2024.

A two-company horseless carriage race

Why is this significant? For one thing, BYD — which surpassed Tesla in terms of quarterly deliveries more than a year ago — now has the most productive EV factory in all of China. This despite the fact that Tesla’s factory in China is the company’s largest. BYD’s Xi’an factory is already one-third bigger, and it accounts for only one-third of BYD’s total production capacity in China.

BYD also plans to produce vehicles in Brazil, Hungary, India, Indonesia, Mexico, Thailand, the U.S., and Uzbekistan. Globally, the company expects to pass 4 million EVs produced by the end of 2024.

As Electrek goes on to point out, BYD is now so big that it’s buying its own fleet of cargo ships to carry its wares around the world, which will enable it to compete with Tesla in other countries.

Is BYD stock a buy?

So how much does it cost to invest in BYD? And should you?

At $108 billion in market capitalization, with $4.7 billion in annual profit and $5.4 billion in annual free cash flow, BYD stock costs just 23 times annual earnings and 20 times annual free cash flow (FCF). That’s a lot cheaper than Tesla’s 117 P/E ratio and its price-to-FCF ratio of 413!

With a 20% growth rate, BYD stock already looks fairly priced to me. Throw in a modest 1.3% dividend yield (Tesla pays no dividend), and I think BYD stock just might be cheap enough to buy.