Nio (NYSE:NIO) stock has had a pretty good run and the company is on an expanding spree this year.
Nio has been reporting impressive delivery numbers and outstanding results this year.
However, the stock is yet to reach the highs it made in January 2021. NIO stock was trading close to $62 in January and was as low as $31 in May.
It had gained momentum after NIO Power day and the impressive delivery numbers. The stock is currently exchanging hands at $43.
I feel Nio is undervalued and it has the potential to become one of the largest EV companies in the industry.
Considering the delivery numbers and the planned expansion in swap stations, I see Nio as a global brand in the coming years. Let’s take a look at the driving factors behind NIO stock.
Delivery and Expansion
One fundamental growth indicator for the company is high delivery numbers. If you take a look at the delivery numbers reported by Nio, you will notice a massive month-over-month increase.
The company delivered 8,083 vehicles in June, 6,711 vehicles in May, 7,102 vehicles in April, and 7,257 vehicles in March.
We see a consistent rise in the delivery numbers except in the month of May which was due to the chip shortage.
The company is setting new records with the delivery numbers which is proof that it is here to stay and the users are satisfied with the vehicles.
Nio has signed an agreement with Sinopec (NYSE:SHI) to build more than 5,000 battery swap stations. Its key selling point is the technology that allows users to charge the battery within no time.
It has also signed a contract with Jianghuai Automobile Group for the expansion of the annual production volume to 240,000 units. This shows that the company has long-term plans and is aiming at high delivery numbers in the coming years.
Long-Term Growth Plans
The company launched NeoPark in May. It is a smart EV industry park that will be a one-stop place for everything EV-related.
It is a great move for the company and will help Nio achieve domination in the industry.
The park will have three main areas- a living space, R&D, and smart manufacturing. NeoPark will have an annual manufacturing capacity of 1 million vehicles and will realize a gross yearly output of RMB 500 billion.
Nio is all set to establish itself as a key player in Norway. The company will operate the first NIO showroom in Oslo by the end of 2021.
It also intends to deploy the battery swap stations in the future. Norway remains one of the largest consumers of EV and it has massive demand which is why it is the key market for all EV companies.
The Bottom Line on NIO stock
All in all, Nio looks well-positioned in the market. With strong delivery numbers, impressive future plans, and smart technology, the company is here to take your driving experience to another level.
It has become an established brand in the industry and Q2 results will be proof that the company is moving in the right direction.
Nio may not have a smooth ride to the top but it is never easy to win in the competitive market. However, it is one company that has the most potential you can count on. Any dip in NIO stock is an opportunity to add to your portfolio.
If the company manages to establish itself as a key player in Norway, there is no looking back. I believe the company is undervalued and could be worth much more.
The stage is set, Nio has to fire in the right direction and it could be one of the most valued EV companies in the industry.
On the date of publication, Vandita Jadeja did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
