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An NIO showroom in Beijing.
Qilai Shen / Bloomberg
NIO’s stock could more than double, according to Deutsche Bank analyst Edison Yu, who released a “return roadmap” for the Chinese electric vehicle maker on Tuesday. The optimistic note, however, couldn’t prevent NIO from having a terrible day on Tuesday.
NIO stock fell around 35% last year, but Yu cited a number of factors that could trigger a rally. Yu is pricing NIO stocks (ticker: NIO) Buy and has a target of $ 70 for the price. This implies a gain of around 120% from the current price of around $ 32.
NIO increased shipments by more than 100% in 2021, but like the shares of many Chinese companies listed in the United States, the stock fell as investors worried about increased regulatory risks associated with delisting. and Chinese market surveillance.
Yu focuses on the fundamentals rather than the potential for regulatory issues. He listed eight catalysts he sees for the stock.
The first is that NIO will start delivering its new ET7 sedan in March. Yu expects the company to unveil its sixth model around the middle of the year, for the No.2. NIO’s driver assistance feature upgrades represent a third potential boost. And another new model, the ET5, is expected to ship later this year, while the ET7 is expected to hit German roads around the same time.
The sixth model could be shipped by the end of the year. It is the sixth catalyst. Seventh on the list is the battery improvement Yu expects at the end of the year. Finally, Yu expects the company to announce a low-cost mass vehicle by the end of the year.
If things go as Yu plans, the stock might regain some lost mojo. NIO shares rose about 1,100% in 2020, before the 2021 decline.
The rest of Wall Street doesn’t seem to have much of a problem with his point of view. Almost 85% of analysts covering the company rate stocks at Buy, well above the average Buy-rating ratio for stocks in the
S&P 500,
at about 55%. The average price target among analysts is $ 60 a share, a little less than Yu’s call, but a figure that still implies gains of nearly 90% from recent levels.
NIO stock did not respond to the report on Tuesday. Stocks ended down 5.7, while the S&P 500 was down 0.1%, and the
Dow Jones Industrial Average
gained 0.6%. The title was up 5.7% on Monday.
Write to Al Root at [email protected]
