The Nio (NYSE:NIO) stock analysis is one of the most frequently asked about stocks. Today we'll examine this electric car company that was on the verge of bankruptcy last year but might have just figured out a battery swap solution for eclectic vehicles, something that its rival, Tesla (NASDAQ:TSLA) CEO Elon Musk gave up on back in 2015.
NIO Stock Analysis - Fundamentals
NIO is an electric vehicle maker based in China that produces cars ranging from around $50K to $78K in price. Comparing this price range to that of Tesla, you can buy a basic Tesla Model 3 at around $40K or go up the ladder and buy a performance Tesla Model X for over $100K which evidently is one of the cars that my husband and I currently drive.
How does NIO compare to Tesla?
Obviously, Tesla has a much higher global brand recognition and is an established company with over $163B in market cap, while NIO sits at just about $4B market cap with incredibly shaky earnings, so I wouldn’t consider it a Tesla killer, but the Chinese company is sure ambitious and their efforts were evident during their earnings call on May 28, 2020, which showed that despite the damages of the COVID-19 pandemic, their EV market share is rebounding in China.
How are Recent NIO Financial Statistics?
NIO delivered 3,838 cars in the first three months of the year. That is down from 8,224 cars in the fourth quarter of 2019 and from 3,989 vehicles in the first quarter of last year.
That doesn’t sound great, but sales came in at about $194 million. Analysts were looking for $180 million. What’s more, the loss of 23 cents per share was also a little better than analysts predicted. Don’t forget, the pandemic that shut the U.S. economy near the end of March hit China earlier in 2020.
Right after the earnings results, NIO’s CEO told Bloomberg on Sunday that he sees Tesla more as an ally than a competitor, and that their sales kept growing since Tesla started production in Shanghai.
What Sets NIO Apart?
One of the things that sets NIO apart is its focus on battery swapping technology. You can drive into one of its 136 automated swap stations along many of China’s busiest highways with a dead battery and drive out a few minutes later with a fully charged battery ready to complete your journey.
Even though the process only took 90 seconds, back in 2015 Elon Musk concluded that batter swaps aren’t very popular. Among the US consumers.
But there seems to be more interest among NIO owners in China. This month, NIO Power, the subsidiary that operates the battery swapping stations, completed its 500,000th swap. But it doesn’t end here. Not only do drivers get a fully charged battery, they also get a complimentary inspection of their car’s electric powertrain. Battery swapping also means customers always have the latest battery technology available to them and they can choose to upgrade to a larger, more powerful battery at any time.
With Tesla, you’d have to either build in your Tesla charges in your home or sit in a Tesla supercharger station for around 30 minutes to get your battery fully charged. Tell Me More About NIO's Electric Car Technology
Nio’s SUV smart electric flagship battery range, according to its website, is 580 KM which is around 360 miles while Tesla’s model X is around 328 miles.
I don’t live in China and I’m not sure how the NIO cars are perceived over there, how safe the car is, and how accurate their advanced diver assistance system is, and we don’t know when and if the NIO cars will be available for sale in the US. Meanwhile, Tesla is certainly well-positioned in China with its cheap batteries.
NIO Stock Price - Technical Analysis
The NIO stock price reached the resistance zone below $6 on Wednesday, June 3rd. This occurred after the positive analyst's reviews over NIO's earning which helped NIO stock price to bottom out.
NIO Stock Price Analysis - Daily Chart with Ichimoku Cloud
The price has also broken above the daily Ichimoku cloud. However, the current resistance level has been tested multiple times in the past 6 months and may turn into a strong barrier holding the bullish moment back.
With that, we could see a temporary pullback here before seeing further gains toward then next key levels at 7.45, 8.97, and 11.
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