Nio Hits Big Milestone As Wall Street Sees ‘Strong EV Leader In the Making’ By Investors Business Daily
Nio (NIO) announced a key production milestone as Morgan Stanley turned more bullish on the electric-car maker. Nio stock soared.
Nio’s 5,000th electric vehicle of the month rolled off the production line at a Hefei manufacturing plant, the company said Thursday.
Reports in local Chinese media said that was the first time that Nio has exceeded 5,000 units per month.
The milestone comes a day after Morgan Stanley raised its earnings forecasts and price target for the so-called Tesla (TSLA) of China. The hikes were driven mainly by better-than-expected Q3 deliveries and a more visible growth outlook, the firm said.
“The pace of Nio’s progress in achieving its strategic and investment ambitions is tracking ahead of our expectations on all fronts,” Morgan Stanley analyst Tim Hsiao wrote. His research note was titled “A strong EV leader in the making.”
The firm expects China EV competition to intensify in 2021. But it believes incumbents and new entrants will struggle to replicate Nio’s diverse strategies.
“We look for Nio to reinforce its pole position through superior volume scale, good spectrum of model/market coverage, self-driving technologies and diversification into power solutions,” Hsiao said.
Notably, the analyst predicts Nio EV sales should see stronger volumes for the rest of 2020 into 2021. He cited stronger-than-expected demand and strong backlog for Nio’s EC6 electric coupe SUV, a potential rival to the Tesla Model Y. A made-in-China Model Y is likely to begin deliveries around the start of 2021.
And on Jan. 9, Hsiao expects a lower-priced fourth model to be launched at the annual Nio Day, joining the EC6 and older ES6 and ES8 electric SUVs. There have been some images of a Nio sedan that could comp
He kept an overweight rating while raising his price target on Nio stock to 33 from 20.50.
Nio Stock, Electric Car Stocks
Shares of Nio surged 16% to 31.99 on the stock market today, hitting a record high. Nio stock is extended from an Aug. 25 breakout past a 15.55 buy point, meaning shares are not in buy range.
Li Auto (LI) advanced 10% to 20.62, not far from a 21.96 buy point. Xpeng Motors (XPEV) gained 8.9%. Both China electric car stocks came public this summer. BYD (BYDDF), a Chinese EV and battery maker that trades over the counter in the U.S., leapt 12.5% to 20.78, a new high.
Tesla stock rose 1.2% to 410.83, slightly below its 50-day moving average. Among other electric car stocks, Nikola (NKLA) edged up 0.6%.
Morgan Stanley’s note comes two weeks after JPMorgan also turned more bullish on Nio stock. The firm also cited in part the EC6 backlog and the debut of a fourth model.
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