Analyst Ji Shi of CMB International Securities maintained a Hold rating on Nio (NIO – Research Report), with a price target of $5.00.
Ji Shi’s rating is based on a combination of factors that reflect Nio’s current financial and operational challenges. Despite the company’s vehicle gross profit margin meeting expectations in the fourth quarter of 2024, the overall revenue fell short due to lower average selling prices. This revenue miss, combined with higher-than-expected selling, general, and administrative expenses, resulted in a net loss that was wider than anticipated.
Ji Shi also highlights the limited potential for cost reduction, as Nio is engaged in significant projects like in-house chip and battery swap development, which constrain its ability to cut expenses further. Even with optimistic assumptions regarding sales volume and gross profit margins for 2025, the analysis suggests that Nio will continue to incur net losses. Consequently, Ji Shi maintains a Hold rating, reflecting a cautious outlook on Nio’s ability to achieve breakeven in the near term.
Shi covers the Consumer Cyclical sector, focusing on stocks such as Geely Automobile Holdings, Nio, and China MeiDong Auto Holdings. According to TipRanks, Shi has an average return of 11.8% and a 52.38% success rate on recommended stocks.
In another report released today, DBS also downgraded the stock to a Hold with a $4.90 price target.