Nio Share Price Target Cut – Analyst Says it Was Another Disappointing Quarter

Electric vehicle maker NIO reported third-quarter earnings before the open on Thursday, reporting a wider-than-expected loss.

The Chinese EV firm posted a loss per share of $0.30 on revenue of $1.83 billion. Analysts expected a loss per share of $0.16 on revenue of $1.77 billion. Vehicle deliveries during the quarter came in at 31,607.

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Following the release, Bernstein analyst Eunice Lee cut the firm’s price target on Nio to $15 from $25, maintaining a Market Perform rating on the shares.

In a note to clients, the analyst claimed that NIO reported another disappointing quarter, with its loss widening while operating expenses “ballooned.” 

She argued that NIO has yet to demonstrate it can deliver more than 15,000 vehicles in a month, while its Q4 sales volume outlook of 43,000 to 48,000 units suggests it has to deliver at least 33,000 vehicles in November and December. 

While she noted that NIO has a solid product cycle setup and channel checks suggest healthy ET5 demand, Covid cases in Hefei, where its plants are located, and potential supply chain shortages “remain wild cards,” added Lee.

Despite the downbeat note from Bernstein, investors were pleased with the company’s quarter as its share price jumped over 11% during the session. Last week its stock also rose on the back of its October delivery report.