Nio Stock: Could 2022 Change Its Course?

Regardless of secular industry tailwinds, elevated demand, and favorable policies, 2021 hasn’t been a great year for the Chinese EV maker Nio (NIO). 

It is worth noting that Nio ADR (American Depositary Receipt) has underperformed the Nasdaq composite index this year and is down over 13% on a year-to-date basis. 

What’s Hurting Nio?

A confluence of factors, including the ongoing supply-chain challenges, lower October vehicle deliveries (down 27% year-over-year), and restructuring of the manufacturing lines, took a toll on Nio stock. There is also the overall selling in Chinese stocks following the government’s increased regulations played spoilsport. 

The investors’ sentiment on Nio stock remains negative. TipRanks’ Stock Investors tool indicates that about 2% of the investors who hold portfolios on TipRanks have decreased their exposure to Nio stock in the last 30 days. 

Could 2022 Be Different?

Mizuho Securities analyst Vijay Rakesh sees strong upside potential in Nio. Rakesh has a Buy rating on Nio stock with a price target of $65 (62.7% upside potential). 

Rakesh sees 2022 as a big year for Nio. His bullish outlook is based on three new model launches, production capacity addition, and expansion in Europe. Notably, during the Q3 conference call, Nio CEO William Li stated that the company will enter five new European countries in 2022. 

Wall Street’s Take

Along with Rakesh, the majority of the analysts remain bullish about Nio’s prospects. On TipRanks, Nio has received eight Buys and one Hold for a Strong Buy consensus rating.

Furthermore, Nio stock scores a 9 out of 10 on TipRanks’ Smart Score system, indicating that it will likely outperform the market.

The average Nio price target of $60.44 implies 51.3% upside potential to current levels.

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