With 50% loss per year, NIO (NIO) The shares have suffered several negative developments in 2022. These include the reversal of growth, the impact on supply chain problems affecting production, and fears of a U.S. listing for Chinese stocks. And more recently, the Zero-Cowid policy has sent large parts of China back into lockdown.
But following a chat with management at Mizuho’s 4th annual Auto Technology Seminar, 5-star analyst Vijay Rakesh thinks that could change.
“With the light at the end of the Shanghai Lockdown Tunnel, NIO is on track for LT growth with its premium EV leadership, EU / global expansion underway, and mass market brand launch in 2024E,” said Rakesh.
As supply improves and May production appears to be improving week after week after Shanghai reopens, Rakesh believes that by early June, production could “potentially” return to pre-shutdown levels.
With further improvements expected in the supply chain, analysts believe that it would not be out of place to look at the “ramping” of the planned capacity of NIO 3 240,000 in 3Q22E. The company is making sure that it can cope with future supply tightness and is looking at several suppliers for key components.
In addition, the tooling / production trail for NIO’s medium-sized smart electric sedan, the ET5, is underway at the 300,000-capacity NEO Park facility, and Rakesh believes the company is on the way to a production ramp on the 2H22E that could further increase 2H production. Power.
There are also launches of the next generation “Nio Pilot +” with “improved performance” to look forward to in the coming months. The product also looks financially attractive compared to Tesla’s equivalent offers; Nio’s Pilot + ADAS is sold in RMB15,000 and RMB39,000 alternative packages, with a 40-50% discount on Tesla-like autopilots and full self-driving, which sells for RMB 32,000 and RMB 64,000.
All told, Rakesh shares a buy with NIO with a target price of $ 60. The figure suggests that shares will rise a huge 275% in the coming year. (To view Rakesh’s track record, Click here)
Street almost unanimously agreed with Rakesh; With the exception of one skeptic, the other 14 analysts’ reviews are positive, which makes the consensus view a strong buy. At an average price target of $ 40.61, the stock has a one-year growth rate of 147%. (See NIO Stock Forecast at TipRanks)
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Disclaimer: The views expressed in this article are those of the featured analyst only. Content is intended for informational purposes only. It is very important to do your own analysis before making any investment.