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Well, it turns out that the parties to the conflict have been about Nio’s inventory (NYSE: NIO) from the beginning.
After a dramatic increase in value in June that saw the Chinese electric car company more than double its percentage value, many investors saw the announcement of Nio’s second quarter effects as evidence that Nio’s inventory could have been just a flash in the pan.
As a new and developing electric vehicle company, Nio expected to record a loss of profits on August 11.
The loss is 15 cents consistent with the consistent percentage of the U.S. custodian. Compared to the 26 cents consistent with the consistent loss rate analysts expected. Revenues $493.4 million, compared to $504 million expected through analysts.
For the quarter, Nio recorded a loss of $166.5 million and an operating loss of $164.2 million, however, this is a huge improvement over the company’s $469.9 million loss a year ago.
Most importantly, Nio did the task of generating the vehicles. He delivered 10,331 of his ES6 and ES8 vehicles, setting a quarterly record for the company. And Nio announced plans to deliver between 11,000 and 11,500 in the third quarter, with revenues between $572.9 million and $596.2 million.
Founder and President William Li noted that the company had achieved its most productive gross margin in line with the vehicle (9.7%) and I had positive money for the first time. “The current quarter of 2020 was a vital quarter for us,” he told analysts.
I’m not one of those who are making a profit in Nio here, there was a downward movement in the percentage value after the earnings report.
Nio fell 7% after his earnings report and remained down for the rest of the week, recording a 9% loss at the end of the week. Part of the challenge is Tesla’s ongoing strength (NASDAQ: TSLA), which announced a 5-by-1 inventory division and recently peaked at $1700 consistent with participation.
Tesla’s global strength, which now outperforms Toyota (NYSE: TM) as the world’s most valuable automaker, has helped raise Nio’s profile and other electric vehicle stocks.
Markets Insider reports that Tesla will soon increase Model Y production at its Shanghai plant.
That said, there’s a lot of Nio bulls out there. J.P. Morgan analyst Nick Lai raised his value target for Nio shares from $11 to $14, forecasting an increase in demand for new electric cars in China. However, he also predicted a drop in short-term values, leading to “stretched” valuations.
Piper Sandler analyst Alexander Potter also raised his target from $4 to $14.
“With a solid balance and a well-established brand, NIO has a chance to earn us the nickname ‘China’s Tesla’,” he wrote in a study note.
The merit of the terrain: I’ve already talked about it, but it requires some explanation. Nio is in China and China has one of the largest electric vehicle markets in the world. But it just scratches the surface.
The Chinese government has supported local businesses through policy: this is one of the main issues of tension between Beijing and Washington. For electric vehicles, China grants a subsidy for the purchase of new electric vehicles.
The grant was due to expire this year, but Beijing extended it until 2022. In addition, the subsidy will not be granted to foreign corporations such as Tesla.
In addition, China supports Nio’s battery replacement technology. In short, drivers can connect to battery exchange stations and replace their old battery with a newly charged one.
The Chinese subsidy for electric cars will not apply to cars whose price is determined. However, cars supplied with battery exchange generation are exempt from this threshold.
That’s what I call the merit of the camp.
When you buy a Nio vehicle, you get more than just one car. You get all the logo and culture that Nio is creating.
To this end, Nio creates a complete lifestyle logo that comes to fashion and culture. He sells garments that he says are animated through his electric cars and “embody the spirit of pushing barriers and breaking down barriers.”
The company also owns the Nio spaces, which are smaller than the Nio space and include a showroom with products for sale.
Nio says he expects two hundred Nio houses and Nio spaces to be operational until the end of the year.
As an electric vehicle company, Nio occupies an enviable position as a company operating alongside a government that is deeply interested in local success.
If it manages to adapt to a cultural phenomenon, able to move markets and define fashion or lifestyle trends through the strength of its network of Nio houses and spaces, then this company becomes one of the most attractive Chinese stocks on the market.
Patrick Sanders is an independent editor in Maryland and, from 2015 to 2019, led the investment advisory segment at U.S. News and World Report. Follow him on Twitter at 1patricksanders. At the time of writing those lines, it was long NIO and TSLA.
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