Nio (NYSE:NIO) reported its May delivery numbers over the weekend. During the month, Nio delivered 20,544 vehicles, up by 233.8% year-over-year (YOY) and reaching a monthly record high. That brought the Chinese electric vehicle (EV) company’s year-to-date (YTD) deliveries to 66,217, increasing by 51% YOY.
This is Nio’s second time delivering over 20,000 vehicles in one month. The first was in July 2023 when it delivered 20,462 vehicles.
NIO stock is in the red today, but closed higher by 4% in Hong Kong where it trades as 9866.
Before the May numbers were released, Bank of America analyst Ming Hsun Lee called for strong second-quarter deliveries due to Nio releasing its 2024 models and cutting the monthly leasing price for its battery-as-a-service (BaaS) by as much as 33%.
NIO Stock: Nio Delivers a Record 20,544 Vehicles in May
Based on these factors, Lee raised his 2024 delivery outlook by 6% to 193,000 vehicles. That implies growth of 20.6% compared to 160,308 deliveries last year.
At the same time, the analyst also lowered his NIO stock price target to $5.90 from $6.50.
Lee now expects the company to spend more on operational expenses (OPEX) than previously expected. His OPEX-t0-revenue ratio estimate is now 41.6% compared to the previous estimate of 34.8%. This is largely due to an expectation for higher sales and marketing expenses amid the launch of Nio’s new Onvo vehicle brand and expected 2024 research and development expenses of $1.89 billion. Onvo unveiled its first vehicle last month, the L60, at a starting price tag of $30,500.
Meanwhile, Morgan Stanley analyst Tim Hsiao reiterated his price target of $10 on May 31. Hsiao’s price target remains unchanged as he waits for the company’s upcoming Q1 earnings report on Thursday, June 6. Hsiao will be focused on guidance for deliveries and margins, as well as further details on Onvo.
For Q1, analysts expect revenue of $1.443 billion, signaling a yearly decline of 2.1%. Nio is also expected to stay unprofitable with a GAAP EPS loss of 28 cents compared to a loss of 41 cents a year ago.
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.
