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Nio Stock Dropped Wednesday: Is This an Opportunity?

Motley Fool2021-10-28

What happened

After kicking off Wednesday on a positive note and popping by 2% in early morning trading,electric vehicle stock Nio(NYSE:NIO) shed all of those gains and then some. At the close of the session, Nio shares were down by 2.9%.

It seems investors are weighing the impact of rising competition on the Chinese automaker's prospects and finding it worrisome.

So what

Nio's chief rival Tesla(NASDAQ:TSLA)is firing on all cylinders. After Tesla bagged an order for 100,000 electric vehicles from rental company Hertz earlier this week,it was back in the news again Wednesday after Hertz struck a deal with Uber Technologies to rent it 50,000 Tesla EVs. Although that development built on Hertz's previous order, it reflects the massive potential of the EV industry and the unmistakable traction that Tesla has already gained within it. It's also racing ahead in Nio's core market of China.

IMAGE SOURCE: GETTY IMAGES.

On Wednesday morning,General Motors(NYSE:GM) CEO Mary Barra told CNBC that the auto giant could "absolutely" catch up with Tesla on EV sales by 2025. In June, GM announced an ambitious goal of selling more than 1 million EVs worldwide by 2025, backed by investments worth $35 billion in EVs and autonomous vehicles over that period.

Now what

EVs are a hot market right now, and this is just the start. It's therefore unsurprising to see competition intensifying as nearly every automaker strives to get a piece of a market segment with exponential growth potential.

Does that mean Nio will be edged out? I don't think so.

In a short span of time, Nio has established itself as one of the top luxury car makers in China. It delivered more vehicles last quarter than it ever had before, recently began selling in Europe, and is set to launch its first electric luxury sedan, the ET7, in China as well as Norway in 2022 even as it prepares a blueprint for low-priced models to target the mass market in China. Nio's battery-as-a-service program also gives it an edge over rivals, especially among cost-conscious consumers.

So while Tesla's wins may rattle Nio investors momentarily, the Chinese automaker is a long-term growth story and looks like one of the most promising EV stocks right now to buy on a dip.

免责声明:本文观点仅代表作者个人观点,不构成本平台的投资建议,本平台不对文章信息准确性、完整性和及时性做出任何保证,亦不对因使用或信赖文章信息引发的任何损失承担责任。

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评论36

  • hpt
    ·2021-11-01
    Like
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  • Cedric77
    ·2021-10-30
    A dipped for NIO is a year end discounted Christmas gift ! Is a DCA for me. Yes. EVs like Tesla, NIO,BYD, Lucid etc are the few great stocks to own!!
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  • Barbarazhao
    ·2021-10-29
    Good to know
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  • PKsummer
    ·2021-10-29
    Thanks for the comment for NIO.Will import more NIO stock when on dip and one day it shall raise to top of EV.[财迷] 
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  • ToongMH
    ·2021-10-29
    Definitely yes
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  • Cheryi
    ·2021-10-28
    Like
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    • ZJ0429
      kk
      2021-10-28
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  • koolgal
    ·2021-10-28
    Nio is facing lots of competition not only from Tesla but other EV makers as well. But as long as they continue their laser focus on building good EVs, their success will be assured in the long run. 
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    • koolgal回复EZU
      True.  I have a small position with Nio. 👍😊
      2021-10-29
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    • EZU回复koolgal
      This is also depends on your conviction towards the company
      2021-10-29
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    • koolgal
      Yes but it is going to be a long term hold 👍😊
      2021-10-29
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  • hpt
    ·2021-10-28
    Ok
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  • Kel9670ong
    ·2021-10-28
    Someone is taking profit? 
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  • Nice
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  • Newbie_21
    ·2021-10-28
    Will dollar averaging down.. 
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    • 滚股怪
      Dont k now
      2021-10-28
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  • Robinshk
    ·2021-10-28
    Give my a like. Thanks 
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  • MHh
    ·2021-10-28
    I think there is still some consumer preference and consumer price point 
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  • james_l
    ·2021-10-28
    Hope so
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  • OinKeY
    ·2021-10-28
    Wow! Cool!
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  • Huat Huat Al
    ·2021-10-28
    Huat Huat all
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    • OinKeY
      Yea
      2021-10-28
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  • Dcpaddidog
    ·2021-10-28
    Like pls
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  • HWChua1961
    ·2021-10-28
    Rotational play buy on value
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  • Sugary
    ·2021-10-28
    Xpeng or nio?
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    • GuSen
      But Nio is what I am holding 🤣
      2021-10-28
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    • GuSen
      Xpeng overtook Nio in share price lo
      2021-10-28
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    • KLCC
      I’d go with XPEV based on past 6 month performace XPEV rebounds better & NIO has been fluctuating around 38-40
      2021-10-28
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    查看更多 1 条评论
  • gaof0002
    ·2021-10-28
    To the moooooon
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