Electric vehicle (EV) makers have been seeing their stocks get demolished in the Auto/Tires/Trucks sector. As the hype has retreated and reality set in. Fisker Inc. (NYSE: FSR) shares have fallen into penny stock territory at 17 cents. Lucid Group Inc. (NASDAQ: LCID) is near all-time lows at $2.70, and Rivian Automotive (NASDAQ: RIVN) is also trading near all-time lows at $11.04. Even Tesla Inc. (NASDAQ: TSLA) shares are oversold, trading down 34% year-to-date (YTD).
Chinese EV Makers Getting Feeling the Pain, Too
The Chinese EV makers aren’t faring too well as Xpeng Inc. (NYSE: XPEV)) trades off its lows at $9.73. Li Auto (NASDAQ: LI) is the exception as it continues to separate itself from the pack by being profitable and producing mostly hybrid battery electric vehicles (BEV). This leaves the question, what about NIO Inc. (NYSE: NIO)?
High-End Luxury EVs in China
NIO manufactures high-end EVs that offer sleek design and luxury interiors with advanced technology like advanced driver assistance systems (ADAS) and semi-autonomous capabilities. Its EC6 is a smart electric coupe SUV that is equipped with 9 driving modes, which include 5 basic and 4 scenario-based weather and terrain. Its Sport+ mode bolsters acceleration from 0 to 100 KM/H to 4.4 seconds.
It offers adaptive lighting with a 1.77-meter panoramic glass roof. The ambient lighting as 256 color options with 10 color themes to rhythmic and calming effects projecting a dynamic atmosphere. Lounge seats have 3-zone heating with a backrest that features 18-way adjustments and zero gravity recline mode.
Dominant Market Share at 45%
According to NIO, they command a 45% market share in the Chinese EV industry. Unfortunately, profitability is another story. The company loses mountains of money. It missed its recent EPS estimates by more than 47% despite beating revenue estimates by 1.5%.
Swing and a Miss for Nio
On March 5, 2024, NIO reported a loss of 44 cents, missing consensus analyst estimates by 15 cents. Revenues climbed 6.5% YoY to $2.41 billion, falling short of the $2.57 billion consensus analyst estimates. Vehicle deliveries were 50,045 comprised of 33,679 premium smart electric SUVs and 16,366 premium smart electric sedans, up 25% YoY. Total vehicle deliveries in 2023 was 160,038, up 30.7% YoY. Full-year 2023 revenues were $7.83 billion, and full-year deliveries were 160,338 units. Vehicle margin was 11.9% in Q4 2023. Gross margin improved to 7.5% in Q4 2023 compared to 3.9% in the year-ago period. NIO had a net loss of $756 million in Q4 2023. January 2024 deliveries were 10,055 vehicles, and $8,132 vehicles in February 2024.
Lowered Guidance for Nio
NIO forecast Q1 2024 revenues of $1.478 billion to $1.56 billion versus $2.24 billion consensus estimates. Vehicle deliveries are expected between 31,000 and 33,000, representing a decrease of 0.1% to and increase of 6.3% YoY.
Nio CEO Insights
NIO Co-Founder and CEO William Bin Li commented, "In 2023, NIO set a new delivery record of 160,038 vehicles, ranking first in China's premium BEV market with an average transaction price of over RMB 300,000.”
Li concluded, “We will soon start deliveries of 2024 NIO products equipped with the highest computing power among production vehicles and constantly enhance users' driving and digital experience. Meanwhile, we plan to release Navigate on Pilot Plus (NOP+) for urban roads to all NT2.0 users in the second quarter.”
NIO analyst ratings and price targets are at MarketBeat. NIO peers and competitor stocks can be found with the MarketBeat stock screener.
Daily descending triangle
The daily candlestick chart on NIO illustrates a descending triangle pattern. The descending trendline formed after peaking at $9.57 on December 28, 2023, as shares fell to the flat-bottom horizontal trendline at $5.35. The daily market structure low (MSL) trigger formed at $6.34, which is also a resistance to the descending trendline.
The daily relative strength index (RSI) is stalling at the 44 bands. A drop under $5.35 would trigger the breakdown. Pullback support levels are at $5.35, $4.78, $4.21 and $3.52.
