Nio auto is an emerging car brand in the Electric Vehicle industry, their es6 es8 and ec6 are a triple threat to other emerging electric vehicles.
With the backing of the Peoples republic of China it seems like this car brand is meant to soar.
The vehicle according to auto analysts seems comfortable and reliable and with NIO’s top notch customer service and charging stations, vehicle concept remote charging and battery swap stations, its hard to look past this eventual giant.
The company is trading at the moment of writing this article at 21.81$ and seems an low buy when you also take a closer look at the investors breakdown with powerful names as bridgwater associates, Charles schwab, vanguard and Blackrock to name a few or Canadas Pension Plan, Royal Bank of Canada, Bank of America and CIBC…the list is endless.
Should we wait?
At the moment the company isn’t profitable and the Chinese government bailed them out, but at the same time, the Chinese government has stated that they would not allow NIO to fail, there’s many reasons for that and one of those reasons is china’s direction of going renewable energy and doing away with emissions.
Now lets look at the growth of the company, they have a market cap of 28 billion, revenue forecast to grow approximately 37%, they are growing year over year with 2020 being the most impressionable as their 1 year return was approximately 1,194%!
The one area that I find contradictory is analysts views on the company, some see a downside I believe this can be based on American politics or maybe millennials dropping a ton of money onto the market but then there’s others that put the stock at the moment trading at its fair market value.
One thing which is the constant is the companies financials, the are negative in double digit billions in retained earnings a staggering $-46 billon, they have cash flow to last them the year $989 million with a TTM of $-10 billion. Although we can see the rapid rise of revenues $7.2 billion in 2019 with earnings decreasing from 2018 from $-23.33 billion to $-11.41 billion in 2019.
Analysts state that they will not be profitable in next three years but according to a graph on Simply Wall Street, it seems that NIO may be profitable in 2024.
One things for sure, with all those companies and institutional investors, the backing of the Chinese government and incentive of the government to go renewable energy, a beautiful car and driving ranges of 610km.
how can you go wrong.