Nio Reports Smaller-Than-Expected Quarterly Loss, Vehicle Sales Jump

Nio (NIO), a Chinese manufacturer and seller of smart electric vehicles, posted a better-than-feared 1Q loss driven by robust vehicle sales. Additionally, total revenues for the quarter beat analysts’ expectations. Shares dipped 5.3% to close at $38.99 on April 29.

Nio’s 1Q adjusted loss came in at $0.04 (RMB0.23) per share, versus analysts’ expectations of a $0.16 loss per share. The company reported a loss of RMB1.60 per share in the same quarter last year.

Total revenues of $1.22 billion (RMB7,982.3 million) beat the Street’s estimates of $1.02 billion and advanced significantly from the year-ago period.

Vehicle sales increased 490% year-over-year to $1.13 billion (RMB7,405.8 million) in the quarter, while vehicle margin was 21.2%, compared to negative 7.4% reported in the same quarter last year. Notably, the company delivered a record 20,060 vehicles during the quarter. (See Nio stock analysis on TipRanks)

Adjusted research and development expenses increased 26.4% from the prior-year quarter, while adjusted selling, general and administrative expenses grew 38.3%.

Nio CEO William Bin Li said, “The overall demand for our products continues to be quite strong, but the supply chain is still facing significant challenges due to the semiconductor shortage. In light of the strong momentum under a volatile macro environment, we expect to deliver 21,000 to 22,000 vehicles in the second quarter of 2021.”

For the second quarter of 2021, the company projects total revenues to be in the range of RMB 8,146.1 million ($1,243.3 million) and RMB8,504.5 million ($1,298.0 million), which would represent year-over-year growth of 119% to 128.7%.

On April 19, Mizuho Securities analyst Vijay Rakesh maintained a Buy rating and a price target of $60 (53.9% upside potential) on the stock.

Rakesh continues to view NIO as “well-positioned in a secular EV market as legacy OEMs struggle to balance portfolios between legacy combustion engine and EVs.”

The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating. That’s based on 7 Buys versus 3 Holds. The average analyst price target of $59.84 implies 53.5% upside potential to current levels. Shares have increased 17% over the past six months.

Nio scores a “Perfect 10” from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.


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