A pattern is developing with electric-vehicle stock. They go higher every day. At least it seems so.
Morgan Stanley analyst Tim Hsiao on Wednesday upgraded the shares of Chinese electric-vehicle manufacturer NIO (ticker: NIO) from par to equal purchase and raised its target price from $ 12 to $ 20.50 per share. result? NIO stock jumped 17% to nearly $ 21 a share in afternoon trading. There seems to be no stopping motion.
NIO shares are now 46% for the week and 412% for the year. The stock had a 52-week low of $ 1.19 in October. Subsequently, investors were concerned about the burning of cash and access to capital. NIO stock started rising after the company raised funds from the local government.
According to reports, access to capital is one of the reasons for Hsiao’s upgrade. Another reason cited is the newly-announced battery-as-in-service business model. NIO will sell cars to customers and rent them batteries. This reduces the cost of vehicle acquisition and makes charging and battery use more realized when filled with gasoline.
Baron’s Renewal report is not reviewed. Hsiao is in Hong Kong, getting your report is a bit more difficult. But we know that his price target is the highest among analysts. The average price target is $ 13.50 per share, where the stock is below trading.
Shares of NIO have recently picked up steam as Chinese EV delivery reverses epidemic-induced lows. NIO delivered around 3,500 vehicles in July, up 322% over the year. What’s more, investors are now thinking about selling cars outside of NIO China. All the excitement about 721 leaves the NIO trade for an estimated 2021 sale. Sales multipliers are used because the NIO is not yet profitable.
For comparison, Tesla (TSLA), the EV Behemoth, trades for approximately 9 times estimated 2021 sales.
Tesla’s stock is up 410% year on year, almost NIO’s. Both the S&P 500 and the Dow Jones Industrial Average have higher than comparable returns.
Tesla’s stock was up 5.6% at $ 2,134.05 on Wednesday. Jefferies analyst Philippe Hauchois raised his street-high Tesla stock target price to $ 2,500.
Tesla also hit a new 52-week high on Wednesday, giving the company a market value of over $ 400 billion.
Write Al root at allen.roo[email protected]