Stock Take.
Shares of Chinese EV maker $NIO Inc.(NIO)$ have soared by almost +40% since first week of April 2025.
One Wall Street analyst thinks that's just the beginning.
Not only that, $Citigroup(C)$, Analyst Jeff Chung believes more moves higher are imminent.
As reported by Barron, Chung has in a Sunday (28 Apr 2025) report:
-
Placed NIO on a 30-day positive "catalyst watch".
-
Chung even thinks the stock is worth $8.10 per share.
-
That would represent a more than 100% gain from where it traded at the time of his report.
NIO stock to double?
Nio delivered about 42,000 EVs in Q1 2025. This is more than +40% YoY increase. (see above)
Chung still sees sales growth meaningfully accelerating from here.
The new optimism comes after NIO showcased its newest brands, Onvo & Firefly, at the 2025 Shanghai Auto Show on April 23-24.
NIO’s flagship Onvo L90 SUV also made its debut at the show.
Both sub-brands are aimed at more of a mass-market EV buyer:
-
Offering lower prices.
-
Without sacrificing many of NIO's leading EV technologies.
The auto-show impacted Chung's opinion on NIO:
-
After attending the Shanghai auto show, he is of the opinion that NIO will launch new models much earlier than consensus expected.
-
That could mean 10 new models launching by the end of 2025.
-
He envisions that leading to more than 50% sequential delivery growth in Q2 2025.
-
He believes deliveries could soar to at least 63,000 units in what would be a record quarter.
As of 09 May 2025
Price Target.
Chung thinks investors should buy NIO stock now, with the stock expected to trend toward his $8.10 price target as those models launch and upcoming delivery reports show improved data.
Chung believes NIO's stock is a “Good buy” now. He thinks the price will likely go up to $8.10 as NIO launches new car models and its delivery numbers improve.
NIO's sales are expected to grow faster over time, but the stock price might not rise right away.
Investors buying now should not expect quick gains, even if it seems like a big event is coming. Over time, as sales increase, NIO's stock may rise as Chung predicts.
The $1.5 trillion made-in-America gold rush.
NIO, investors should be aware:
-
Analysts see a big shift in US tech, with over $1.5 trillion flowing into (a) Infrastructure, (b) artificial intelligence (AI) and (c) Advanced manufacturing, and the amount is still rising.
-
However, the surge is happening might be due to a temporary pause on tariffs, that could end at any time.
My viewpoints: (mine only)
It is a contradiction that NIO’s delivery has a +40% YoY gain, yet its stock trading is at historic lows near 0.8 times price-to-sales ratio and it is significantly below NIO’s 5-year average P/S of 2.5.
This historically low valuation suggests either (a) severe market pessimism or (b) potential undervaluation of the company.
A lot has been written about NIO’s March 2025 sales productivity that saw its deliveries reaching 15,039 EVs.
This was a +26.7% YoY increase that when drilled down revealed : Premium brand (10,219 EVs), Onvo diffusion line (4,820 EVs), showcasing the company's multi-brand strategy in action.
Personally, this is not impressive by even by NIO’s standards.
This is because:
-
NIO premium brand’s profit margin is no longer command the quantum like it used to, with all the discounts extended to maintain sales.
-
Onvo, ambitious planned sales volume of 20,000 units by March 2025 did not materialized. (see below)
-
Similarly, its planned yearly sales volume of 220,000 EVs, a 50% contribution to NIO’s 2025’s target of 440,000 EVs, did not happen as well.
-
As a result, Onvo CEO Alan Ai resigned and was replaced by Shen Fei, head of NIO Power.
Objectively, it certainly looks like NIO has a very weak management team that just cannot get things right; nothing to do with the product, it is its people that’s the issue. That includes CEO Li Bin.
Perhaps NIO’s board of directors should consider replacing its CEO , just like Tesla’s BOD ! It’s time for a radical change because NIO deserves to shine and not be held back by inefficiency.
Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks.
-
Do you think it is strange that NIO’s sales & stock price are inconsistent ?
-
Do you think NIO still have a chance to mount a comeback, just not now’?
If you find this post interesting, give it wings! ️ Repost and share the insights ?
Do consider “Follow me” and get firsthand read of my daily new post. Thank you.
Comments
Go NIO