Strong car deliveries last year
Of the 11 Reuters-surveyed analysts covering NIO on January 10, ~36% recommended “buy,” ~55% recommended “hold,” and ~9% recommended “sell.” Their 12-month consensus target price of $7.98 for NIO was 19.8% higher than its January 10 price of $6.66.
On November 19, Citron Research recommended “buy” for NIO and set its price target at $12, which implies a huge 53.1% upside to NIO’s Monday closing price of $7.84. In its report, Citron wrote, “Compelling Product and strong management combined with absurd short interest makes NIO the worst way to bet against China.”
Citron also interviewed many NIO ES8 owners for their feedback and “to test the strength of the brand.” These interviewees, who had previously owned cars by luxury brands such as Porsche, Lexus, and Audi, had highly positive feedback on the ES8.
NIO, founded in 2014, is fairly a new automaker (XLY). As of January 10, it had a market cap of $6.8 billion, compared with Tesla’s (TSLA) $59.2 billion. Chinese companies Alibaba (BABA) and Baidu (BIDU) had market caps of $393.2 billion and $58.7 billion, respectively.