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Baillie Gifford Is Doubling Down on NIO Stock. Here’s Why.


  • Baillie Gifford purchased 7.98 million shares of Nio (NIO) stock during the second quarter.
  • The electric vehicle (EV) company is now the firm’s eighth-largest position.
  • NIO stock is down more than 30% year-to-date (YTD).
NIO ES6 electric SUV semi-autonomous car on display near Chinese automobile manufacturer NIO software development office in Silicon Valley. Chinese EV companies like NIO are in the news.
Source: Michael Vi / Shutterstock.com

Nio (NYSE:NIO) stock is in focus today on news that Baillie Gifford purchased 7.98 million shares during the second quarter, increasing its existing position by 8%. After the purchase, the asset management firm now owns 96.73 million shares of NIO stock. In addition, Nio is now Baillie’s eighth-largest position. This purchase comes after the firm sold 107,774 NIO shares in Q1. On the other hand, Baillie sold 407,949 shares of Tesla (NASDAQ:TSLA) during Q2.

During July, Chinese electric vehicle (EV) maker Nio delivered 10,052 vehicles, up nearly 27% year-over-year (YOY). However, deliveries also declined by 22% month-over-month. Today, NIO stock is down more than 30% year-to-date (YTD) due in part to lockdowns in China, which kept people inside, reduced demand and aggravated supply-chain efficiencies.

Nio also recently formed an independent committee to investigate claims made by Grizzly Research in a short report. Grizzly alleges that the company has been inflating revenue and margins through its battery asset management provider, Wuhan Weineng. There have been no further updates since Nio formed the committee.

That said, Baillie’s recent purchase is a signal that the worst may be over. Let’s get into the details.

NIO Stock: Baillie Gifford Doubles Down

Baillie first purchased NIO stock in 2018, when shares traded below $10. The firm has an average holding period of 12.39 quarters for stocks in its portfolio and an average holding period of 16.8 quarters for its top ten positions. After the purchase, Baillie is Nio’s third-largest shareholder.

In addition to its July deliveries, Nio also recently provided updates on its battery swap stations. During the month, the company installed its 1,000th power swap station. As of the end of July, Nio has installed 1,047 stations and cumulatively provided more than 10 million battery swaps.

With that in mind, here’s a look at the company’s top shareholders.

Who Else Is Betting Big on Nio?

Insider ownership is extremely low for NIO stock, coming in at 0.47% of all shares. However, that figure does not include shares owned by Originalwish, an investment vehicle set up by CEO William Li. Meanwhile, 818 institutional investors own 38.38% of all shares and 38.56% of the public float.

NIO stock’s top five shareholders are as follows:

  1. Originalwish: 177.46 million shares, accurate as of Q1 2022 and beneficially owned by CEO William Li.
  2. Tencent (OTCMKTS:TCEHY): 164.24 million shares, accurate as of Q1 2021.
  3. Baillie Gifford: 96.73 million shares.
  4. BlackRock (NYSE:BLK): 64.58 million shares.
  5.  Vanguard: 49.06 million shares.

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/2022/08/baillie-gifford-is-doubling-down-on-nio-stock-heres-why/.

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