NIO Stock Is up 8% As Nio Looks Set to Achieve Breakeven in 2024

  • 26 auto analysts believe Nio (NIO) will breakeven by 2024.
  • On top of that, reopening in China and an easing of Chinese tech crackdown are positive signals for NIO stock.
  • NIO stock is still down about 40% year-t0-date but up about 8% this morning.
NIO stock - NIO Stock Is up 8% As Nio Looks Set to Achieve Breakeven in 2024

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Nio (NYSE:NIO) stock is rising on several positive catalysts today. First, it appears that the tech crackdown in China may be finally coming to a close. Beijing officials appear to be following through on their promises last March, which include supporting the economy and housing market, as well as effectively ending the year-long tech crackdown. Furthermore, the Hang Seng Tech Index closed up 4.6% at a two-month high. And NIO stock is currently up about 8% this morning.

China is slowly easing its lockdown restrictions. Lockdowns in business hubs Beijing and Shanghai have been eased, as citizens of Shanghai were finally allowed to leave their homes freely. On top of that, none of China’s top 50 cities by economic activity currently have widespread lockdown policies in place.

However, the good news doesn’t end there. According to estimates from 26 auto analysts, Nio is expected to breakeven by 2024. Let’s get into the details.

NIO Stock: Nio Set to Breakeven by 2024

The analysts expect the electric vehicle (EV) company to report a loss during 2023 before reporting a profit of $376 million in 2024. To do this, Nio must grow at an annual growth rate of 77%. The high growth rate, coupled with the 2024 breakeven status, signals that analysts have high expectations for the company.

In 2021, Nio delivered a total of 91,429 vehicles and posted revenue of $5.67 billion. It also reported a net loss of $630 million, while vehicle margins were 20%. In May, Nio reported that it had delivered 7,024 vehicles. Year-to-date, the company has delivered 37,866 vehicles, up 11.8% year-over-year (YOY).

April and May were challenging months for Nio, as lockdowns reduced customer activity and production efficiency. Still, May showed a gradual recovery of deliveries. The company explained:

NIO plans to further ramp up the production capacity to a higher level by working closely with supply chain partners and to accelerate the delivery recovery starting from June, in light of the recent supportive developments in the COVID-19 situation and the strong order inflow.

June will be especially important for Nio, as it will report first-quarter earnings on June 9. Analysts expect the company to report revenue of $1.49 billion on top of an earnings per share (EPS) loss of 13 cents. The revenue figure will imply sales growth of 21%. For its second-quarter guidance, analysts expect $1.63 billion, up 41.8% YOY, with an EPS loss of 12 cents. Expanding out, analysts expect a 2022 revenue of $9.53 billion, implying YOY growth of 73.1%.

On the date of publication, Eddie Pan did not hold (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.

Eddie Pan specializes in institutional investments and insider activity. He writes for InvestorPlace’s Today’s Market team, which centers on the latest news involving popular stocks.


Article printed from InvestorPlace Media, https://investorplace.com/2022/06/nio-stock-is-up-8-as-nio-looks-set-to-achieve-breakeven-in-2024/.

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