Investors shouldn’t overlook this beaten-down Chinese EV maker
- Nio (NIO) distinguishes itself with increasing sales and a unique battery-swapping business model, setting it apart in the competitive market.
- The company delivered around 18,000 EVs in December, making the company up by 31%.
- Nio’s ET9, a premium sedan on a 900-volt platform, is available for pre-order in China.
NIO (NYSE:NIO) stock has had a rough go of it. The company is known for its battery technologies and diverse EV lineup. Opinions on the stock vary, with some analysts optimistic about its potential and a Wall Street consensus marking it as a buy.
Despite a 13% year-to-date decline, NIO received a significant boost with a 12% share price increase, thanks to a $2.2 billion investment from CYVN Holdings. This funding alleviates concerns about NIO’s cash situation, positioning it for growth and market expansion.
Excellent Delivery Statistics and Nio Stock
In 2023, Nio achieved a cumulative delivery of 160,038 vehicles, marking a 30.66% increase from the previous year. December sales surpassed expectations at 18,012 EVs, exceeding the guidance range of 16,000-17,000 vehicles. Cumulatively, Nio delivered 449,594 vehicles by December 31.
To drive year-end sales, Nio offered perks such as 30 free battery swaps, 5000 yuan for accessories, and a complimentary one-year subscription to the NOP+ autonomous driving system for customers making a non-refundable deposit before the year-end cutoff.
Despite Nio’s CEO, William Li, setting a 2023 sales target of 245,000 cars, the company fell short by approximately 90,000 vehicles, delivering 160,038 cars.
While Nio hasn’t disclosed a 2024 delivery target publicly, an internal memo to suppliers indicated an expectation to deliver 230,000 Nio-branded cars in 2024.
December deliveries included 12,048 premium electric SUVs and 5,964 electric sedans, with the ES6 SUV and ET5 sedan being key contributors, accounting for 68% of Nio’s November sales, based on CPCA data.
Flagship Model ET9
The Nio ET9 features a front induction asynchronous motor (180 kW) and a rear permanent magnet synchronous motor (340 kW), delivering a total output of 520 kW or 697 horsepower.
With China’s first Full-Domain 900V Architecture, the 120 kWh battery supports ultra-fast charging of up to 600 kW and a peak current of 765A, using in-house developed large cylindrical cells for efficient 5C charging and a 255-kilometer range extension in just five minutes.
Although not officially confirmed, Chinese media speculates that the Nio ET9 likely uses standard liquid electrolyte NMC batteries, omitting mention of WeLion’s 150 kWh semi-solid state battery during the presentation.
Buy NIO Now
At this point, NIO remains a bargain, with an intrinsic value of $10.92 compared to its current trading price of $8.42. While there may be future opportunities to buy, NIO’s high beta suggests that in a bearish market, its shares could drop more than the overall market, creating a favorable buying chance.
Examining the future outlook is crucial for investors seeking portfolio growth. NIO, with a projected 92% profit growth in the coming years, holds promise for higher cash flow and an elevated share valuation.
This post originally appeared at InvestorPlace.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
