Chinese electric vehicle (EV) maker Nio (NYSE:NIO) is set to release its third quarter Fiscal 2023 earnings results on December 5, before the market opens. While the company impressed investors with its Q3 sales figures, intense competition along with broader macro concerns continued to impact EV demand. Nevertheless, analysts remain optimistic about Nio’s future, emphasizing its cost-reduction initiatives and ongoing vehicle launch strategies.
The company’s top line might have benefitted from strong sales in Q3. Nio achieved a new record-high delivery in the quarter of 55,432 vehicles, which came above the lower end of its guidance range of 55,000 to 57,000 units. Furthermore, deliveries increased 75.4% year-over-year and an impressive 135.7% sequentially compared to Q3 2022.
Analyst’s Opinion
Heading into Q3 results, Deutsche Bank analyst Vincent Ha reiterated a Buy rating on Nio stock with a price target of $11. The analyst noted rising selling, general, and administrative expenses might have put pressure on Nio’s gross profit margin in the to-be-reported quarter. However, he expects the company’s strategic initiatives to boost sales and ROI (Return on Investment) in the long term.
It is worth highlighting that Wall Street analysts are currently expecting Nio to report a loss of $0.36 per share, compared with a loss of $0.30 per share in the same quarter last year. Simultaneously, analysts anticipate NIO to deliver revenue of $2.71 billion in Q3, compared to $1.9 billion in the prior-year quarter.
What is the Future Price of NIO Stock?
Wall Street is optimistic about NIO. The stock has a Strong Buy consensus rating based on four Buys and one Hold rating assigned in the past three months. The average Nio stock price target of $14.38 implies a substantial 101.1% upside potential. The stock is down 26% year-to-date.
Insights from Options Trading Activity
TipRanks now presents options activity to help investors plan their trades ahead of earnings releases. Options traders are pricing in a +/- 10.91% move on Nio’s earnings. NIO shares have averaged a 1.71% downward move in the last eight quarters.
The anticipated move is determined by computing the at-the-money straddle of the options closest to the expiration after the earnings announcement.
Learn more about TipRanks’ Options tool here.
Ending Note
Wall Street remains confident in Nio’s strong technology, potential to capture a larger market share in China, and further expansion plans in Europe and other promising growth markets.
