Best Stocks for 2021: Nio


Editor’s note: This column is part of our Best Stocks for 2021 contest. The Readers’ Choice pick for the contest is Nio (NYSE:NIO).

The logo for the best stocks for 2021 contest.

Source: by InvestorPlace

Overall, 2020 has provided quite a ride for everyone. And as we look back at the past year, some of the best stocks on Wall Street emerged from the rubble of the novel coronavirus pandemic.

From social distancing and working from home to companies that manufacture protective equipment, investors saw several sectors — and names — take off this year. However, some unrelated industries also saw major movements — and that includes electric vehicle (EV) stocks. And the second-half surge from Nio (NYSE:NIO) makes it one of the best stocks for 2021.

The EV market welcomed many new faces to the playing field in 2020. Names like Fisker (NYSE:FSR), Nikola (NASDAQ:NKLA) and Xpeng (NYSE:XPEV) popped up after their own initial public offerings (IPOs). And while the giants like Tesla (NASDAQ:TSLA) continue to be the top dogs of the sector, the EV arms race is heating up.

That said, InvestorPlace readers selected Nio as their best stock for 2021. And while shares are up more than 1100% year-to-date, NIO stock didn’t have most of its gains until the second half of this year. Thus, let’s look at how the “Tesla of China” can ride that momentum into a new year.

Gradual Growth for Delivery Figures

At this moment, Nio boasts a line of three different vehicles: ES8, ES6 and EC6. The EC6 officially launched at the end of 2019, but didn’t begin actual deliveries of the specific vehicle until late September of this year. Nonetheless, Nio’s delivery figures gradually grew throughout the year.

On a quarterly basis, the China-based EV company jumped from 3,838 vehicle deliveries in the first quarter of 2020 to 12,206 in Q3. That is extremely impressive, especially since that figure was just about 4,800 in Q3 the previous year.

Additionally, Nio also announces its delivery figures on a month-by-month basis. Most recently on Dec. 1, the EV maker announced its November deliveries reached 5,291 vehicles — a 109% increase YOY. Comparing that to January’s deliveries reaching 1,598, it’s quite the boost.

Sure, adding another vehicle to your arsenal helps. But as said before, the EC6 did not begin deliveries until later in 2020. That, in turn, makes this growth even more impressive.

Furthermore, the firm said it delivered just 20,565 vehicles during 2019. And while we have to wait until January to receive the full-year figures, I imagine that number will be drastically higher.

According to Barrons, CEO William Li said Nio should reach an annual production capacity of 150,000 vehicles by the end of 2021. And looking even further, Li hopes the firm could even double that number  Thus, if Nio can continue its growth and innovation, it seems there’s nothing stopping NIO stock from going higher.

New Tech at Nio Day?

Speaking of innovation, there is a very important day approaching for NIO stock investors. The company’s annual event – “Nio Day” – is rumored to take place January, and some are expecting major announcements about new products and technologies.

One of the main attractions is said to be the introduction of a new sedan, with another possibly coming the following year. Additionally, news regarding autonomous driving initiatives and “an even larger 150-kWh battery” could prove to be major catalysts for Nio.

New cars and better batteries? Those concepts are music to investors’ ears. And they represent just two reasons why Nio is one of the best stocks for 2021.

Best Stocks: Nio Could Drive Higher in 2021

As I stated above, 2020 provided a number of twists and turns for people across the globe. And while Wall Street had plenty of winners and losers, NIO stock has reaped the benefits and is soaring into 2021.

Of course, there are plenty of concerns across the board when it comes to investing. But, have no fear; Nio has plenty of positives moving in its direction. And its could be a great year for you by snatching up shares of NIO stock. Happy New Year!

On the date of publication, Nick Clarkson did not have (either directly or indirectly) any positions in the securities mentioned in this article. 

Nick is a web editor at InvestorPlace.

Article printed from InvestorPlace Media,

©2023 InvestorPlace Media, LLC