Shares of electric-vehicle (EV) maker Nio (NYSE:NIO) stock are taking off on Wednesday after an upgrade and price hike from one analyst.
JPMorgan’s Nick Lai boosted his call on the stock from “hold” to “buy,” and raised his price target from $14 to $40. This is nearly double the current price NIO stock is trading at, and it’s for good reason too.
According to Barron’s Al Root, “Lai thinks China’s EV penetration will be four times higher by 2025, meaning that about 20% of all new cars sold in China would be battery powered.” This presents a strong case for companies like Nio, and it also helps that China’s electric vehicle industry is expected to grow at a CAGR of 25% between now and 2025.
Moreover, Nio has plenty of catalysts working in its favor at the moment. Aside from its battery-as-a -service announcement in August, the EV maker also reported strong delivery figures from September. In fact, Nio said it shipped 4,708 vehicles during the month — an increase of 133.2% year-over-year. Further, Nio reported 12,206 vehicle deliveries in the three months ended September 2020. This also represents an increase of 154.3% YOY.
Additionally, the company has plans to enter more markets across the globe in the coming years.
Nio stock was up 16.4% on Wednesday morning.
On the date of publication, Nick Clarkson did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Nick Clarkson is a Web Editor at InvestorPlace.