NIO: Poised To Struggle Further

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NIO: Poised To Struggle Further

Seeking Alpha2024-12-19

SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy ...

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am56
·2024-12-26
Fast charging is getting faster
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simonwyj
·2024-12-24
I don't follow Tesla, Tesla, has their own advantages like the analyst pointed out. I am in business myself, as long as there is 60-70% chances of making it, i will go ahead and along the way improvise it. 1st execution is more important than talking. Got the strategy and road map right, like Nio ferociously executing it, then let the analyst keep analyzing, let Nio keep doing right things. Monitor their sales closely, For week till 22Dec, Nio & Onvo 7500 weekly delivery compared to Xpeng 7400. By revenue, Nio already top 3 compared to Aito and others. is closing in on Li Auto and other players.
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simonwyj
·2024-12-23
CATL also reaffirm NIO battery model by entering this market and market is big enough like petrol station with 3-5 players. So those car with battery swap bring many benefits to car purchaser. It will be a trend. CYVN is huge and long term. Given NIo market present and approval from user, government bodies and car safety rating agency. Nio is poised for further growth. i am an avid BMW fan and driving BMW many years. I went to Beijing this year to check out Nio car personally ( I am a Malaysian ) , I would definitely upgrade to NIo from BMW. BMW technology is at least 3 years behind NIo. Needless to say one should wonder why a new brand like Nio could master 45% in the premium market compete against the like of BMW, Mercedes and Audi. Now by lowering their price BBA could only maintain and
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- simonwyj:
  Hi Authur, i am jot surprising, there are market manipulators who knows how deep is their pocket. Check out how George Soros plan 2 years to take down Hong Kong stock, currency and future market in 1998 August. He levearge up to store 100billion HK dollar. It is legendary. How HK stock index went from 16k to 6.7k. So as long as Nio is still unprofitable, they will continue to bet aginst it. Do we believe in What Nio doing , they are in real business creating value and making a difference to society. We will see, patience and discipline are the most virtue in stock investment. However, as Nio keep pushing to cover more market and keep listening to Nio buyer and creating value. Is matter of time the table will flip in 2025/2026. However it doesn’t mean you dont carry risk with Nio, as there is political agenda and this manipulators constant threat. So do your due diligence. I can share more balance insight but do our own due diligence. All the best.
  2024-12-24
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- gogoooCn:
  Wow, very impressive research. But why my NIO has been lying down for so long [Cry][Cry]
  2024-12-24
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simonwyj
·2024-12-23
I think the analysis is load sided. For Nio pricing if they sell 1 Nio and 1 Onvo. The revenue is equivalent to 3.5 Xpeng cars ( g series plus cheap Mona ). So in terms of margin, with Onvo ramp up , they should edge Xpeng margin as well both in revenue and margin. Yes competition is going greater is given. But at the same times there are many ev companies also have gone out of business. With superior technology, greater value offered by Nio and other EV, legacy auto are dying given their slow response and not so great after sales service compared to Nio and Onvo. That is why we are seeing other legacy auto sales volume dropping greatly and pull out of market because not only is their price high but they are old technology. ET9 1st edition 999 units fully sold and order is
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- Wheretotravel:
  Brilliantly written. Your posts on stock performance are always full of wisdom and positivity
  2024-12-24
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- Wheretotravel:
  You have a knack for simplifying complex financial topics. Thanks for the great insights
  2024-12-24
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- Tigerous:
  how abt $Tesla Motors(TSLA)$ then
  2024-12-24
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Meoooow
·2024-12-21
Waiting to sell $7 next year in line with your sell call.
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Meoooow
·2024-12-19
Why don't post this when Nio is above $7? I would have sold everything then. Giving a few more kicks when it's down seems to be in line with shortsellers. Now I think Nio cannot break out of $5 this year. Hope next year Nio can show better performance. Nio believers can give more support? I'm still waiting for a Christmas cheer. 🎄🎄🎄
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NIO remains fundamentally weak, and I am still very pessimistic about the company's prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.NIO stock analysisNIO is fundamentally weak, which can be seen from some large warning trends. The company's financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company's business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.Data by YChartsAs a result, NIO's cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO's cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company's financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.Data by YChartsAnother big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.Data by YChartsFurthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO's R&D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO's financial position cannot be compared to Tesla's fortress balance sheet. Tesla's brand power, technological advancements, and economies of scale present a formidable obstacle for NIO's growth aspirations.Seeking AlphaThe emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO's market share and pricing power.NIO's attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla's plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.Seeking AlphaDue to NIO's weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market's cautious stance on NIO.Intrinsic value calculationIt is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO's WACC is 9.59% and the logic behind is outlined in the below working.DT InvestThe year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notableDT InvestThe notable overvaluation assertion is also supported by NIO's sky-high Price/Book ratios, substantially higher compared to the sector median.Seeking AlphaWhat can go wrong with my thesis?Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.A notable potential positive catalyst is NIO's joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.Another potential positive development is NIO's strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.SummaryNIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.","kind":"news","is_publish_news":true,"is_publish_highlight":true,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[{"id":385641546904048,"gmtCreate":1735191412688,"gmtModify":1735191416431,"author":{"id":"3584247049802991","authorId":"3584247049802991","name":"am56","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":4,"crmLevelSwitch":0,"authorIdStr":"3584247049802991","idStr":"3584247049802991"},"htmlText":"Fast charging is getting faster","listText":"Fast charging is getting faster","text":"Fast charging is getting faster","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/385641546904048","repostId":1123995557,"repostType":2,"repost":{"id":"1123995557","kind":"news","pubTimestamp":1734576729,"share":"https://ttm.financial/m/news/1123995557?lang=&edition=fundamental","pubTime":"2024-12-19 10:52","market":"hk","language":"en","title":"NIO: Poised To Struggle Further","url":"https://stock-news.laohu8.com/highlight/detail?id=1123995557","media":"Seeking Alpha","summary":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy aut","content":"<html><head></head><body><h2 id=\"id_1605177943\">Summary</h2><ul style=\"\"><li><p>NIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.</p></li><li><p>Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO&#39;s market position and growth prospects.</p></li><li><p>Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.</p></li><li><p>Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company&#39;s significant fundamental issues.</p></li></ul><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/3b916cc6035194092506e491862a7d83\" alt=\"NIO&#34;s store with electric car inside\" title=\"NIO&#34;s store with electric car inside\" tg-width=\"750\" tg-height=\"500\"/><span>NIO&#34;s store with electric car inside</span></p><h2 id=\"id_1796068409\">My thesis</h2><p>Despite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company&#39;s prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.</p><h3 id=\"id_3185497874\">NIO stock analysis</h3><p>NIO is fundamentally weak, which can be seen from some large warning trends. The company&#39;s financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.</p><p>The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company&#39;s business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/84bed80e72783706fa357e4ab48c0a43\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>As a result, NIO&#39;s cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO&#39;s cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company&#39;s financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/23f1ccd1de0367a5c3b57fac6b6d1aa4\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"424\"/><span>Data by YCharts</span></p><p>Another big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec8b1ccdefaeaa9780ddf5300bc4c2ef\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>Furthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO&#39;s R&amp;D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO&#39;s financial position cannot be compared to Tesla&#39;s fortress balance sheet. Tesla&#39;s brand power, technological advancements, and economies of scale present a formidable obstacle for NIO&#39;s growth aspirations.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/033d3a63323a2085924b5aeb5227f2f6\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"491\" tg-height=\"432\"/><span>Seeking Alpha</span></p><p>The emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO&#39;s market share and pricing power.</p><p>NIO&#39;s attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla&#39;s plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec4e38603890600b4372bf41f7a5c080\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"204\"/><span>Seeking Alpha</span></p><p>Due to NIO&#39;s weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market&#39;s cautious stance on NIO.</p><h3 id=\"id_344676228\">Intrinsic value calculation</h3><p>It is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO&#39;s WACC is 9.59% and the logic behind is outlined in the below working.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/d8cd7881e1edcbd9de45374095e70aef\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"358\"/><span>DT Invest</span></p><p>The year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.</p><p>As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notable</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/4713289dbe2c4158d53b357b109e0dff\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"431\"/><span>DT Invest</span></p><p>The notable overvaluation assertion is also supported by NIO&#39;s sky-high Price/Book ratios, substantially higher compared to the sector median.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/88737da4ee3149562777b9e3f02c13ae\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"607\" tg-height=\"61\"/><span>Seeking Alpha</span></p><h3 id=\"id_3234834443\">What can go wrong with my thesis?</h3><p>Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.</p><p>A notable potential positive catalyst is NIO&#39;s joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.</p><p>Another potential positive development is NIO&#39;s strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.</p><h2 id=\"id_3760190078\">Summary</h2><p>NIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.</p></body></html>","source":"lsy1728464409321","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>NIO: Poised To Struggle Further</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nNIO: Poised To Struggle Further\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-19 10:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy ...</p>\n\n<a href=\"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09866":"蔚来-SW","NIO.SI":"蔚来","NIO":"蔚来"},"source_url":"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1123995557","content_text":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO's market position and growth prospects.Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company's significant fundamental issues.NIO\"s store with electric car insideMy thesisDespite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company's prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.NIO stock analysisNIO is fundamentally weak, which can be seen from some large warning trends. The company's financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company's business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.Data by YChartsAs a result, NIO's cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO's cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company's financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.Data by YChartsAnother big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.Data by YChartsFurthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO's R&D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO's financial position cannot be compared to Tesla's fortress balance sheet. Tesla's brand power, technological advancements, and economies of scale present a formidable obstacle for NIO's growth aspirations.Seeking AlphaThe emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO's market share and pricing power.NIO's attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla's plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.Seeking AlphaDue to NIO's weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market's cautious stance on NIO.Intrinsic value calculationIt is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO's WACC is 9.59% and the logic behind is outlined in the below working.DT InvestThe year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notableDT InvestThe notable overvaluation assertion is also supported by NIO's sky-high Price/Book ratios, substantially higher compared to the sector median.Seeking AlphaWhat can go wrong with my thesis?Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.A notable potential positive catalyst is NIO's joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.Another potential positive development is NIO's strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.SummaryNIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":385115064078424,"gmtCreate":1735033380726,"gmtModify":1735041846838,"author":{"id":"3574147611851381","authorId":"3574147611851381","name":"simonwyj","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":5,"crmLevelSwitch":0,"authorIdStr":"3574147611851381","idStr":"3574147611851381"},"htmlText":"I don't follow Tesla, Tesla, has their own advantages like the analyst pointed out. I am in business myself, as long as there is 60-70% chances of making it, i will go ahead and along the way improvise it. 1st execution is more important than talking. Got the strategy and road map right, like Nio ferociously executing it, then let the analyst keep analyzing, let Nio keep doing right things. Monitor their sales closely, For week till 22Dec, Nio &amp; Onvo 7500 weekly delivery compared to Xpeng 7400. By revenue, Nio already top 3 compared to Aito and others. is closing in on Li Auto and other players.&nbsp;","listText":"I don't follow Tesla, Tesla, has their own advantages like the analyst pointed out. I am in business myself, as long as there is 60-70% chances of making it, i will go ahead and along the way improvise it. 1st execution is more important than talking. Got the strategy and road map right, like Nio ferociously executing it, then let the analyst keep analyzing, let Nio keep doing right things. Monitor their sales closely, For week till 22Dec, Nio &amp; Onvo 7500 weekly delivery compared to Xpeng 7400. By revenue, Nio already top 3 compared to Aito and others. is closing in on Li Auto and other players.&nbsp;","text":"I don't follow Tesla, Tesla, has their own advantages like the analyst pointed out. I am in business myself, as long as there is 60-70% chances of making it, i will go ahead and along the way improvise it. 1st execution is more important than talking. Got the strategy and road map right, like Nio ferociously executing it, then let the analyst keep analyzing, let Nio keep doing right things. Monitor their sales closely, For week till 22Dec, Nio & Onvo 7500 weekly delivery compared to Xpeng 7400. By revenue, Nio already top 3 compared to Aito and others. is closing in on Li Auto and other players.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":13,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/385115064078424","repostId":1123995557,"repostType":2,"repost":{"id":"1123995557","kind":"news","pubTimestamp":1734576729,"share":"https://ttm.financial/m/news/1123995557?lang=&edition=fundamental","pubTime":"2024-12-19 10:52","market":"hk","language":"en","title":"NIO: Poised To Struggle Further","url":"https://stock-news.laohu8.com/highlight/detail?id=1123995557","media":"Seeking Alpha","summary":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy aut","content":"<html><head></head><body><h2 id=\"id_1605177943\">Summary</h2><ul style=\"\"><li><p>NIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.</p></li><li><p>Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO&#39;s market position and growth prospects.</p></li><li><p>Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.</p></li><li><p>Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company&#39;s significant fundamental issues.</p></li></ul><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/3b916cc6035194092506e491862a7d83\" alt=\"NIO&#34;s store with electric car inside\" title=\"NIO&#34;s store with electric car inside\" tg-width=\"750\" tg-height=\"500\"/><span>NIO&#34;s store with electric car inside</span></p><h2 id=\"id_1796068409\">My thesis</h2><p>Despite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company&#39;s prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.</p><h3 id=\"id_3185497874\">NIO stock analysis</h3><p>NIO is fundamentally weak, which can be seen from some large warning trends. The company&#39;s financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.</p><p>The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company&#39;s business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/84bed80e72783706fa357e4ab48c0a43\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>As a result, NIO&#39;s cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO&#39;s cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company&#39;s financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/23f1ccd1de0367a5c3b57fac6b6d1aa4\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"424\"/><span>Data by YCharts</span></p><p>Another big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec8b1ccdefaeaa9780ddf5300bc4c2ef\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>Furthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO&#39;s R&amp;D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO&#39;s financial position cannot be compared to Tesla&#39;s fortress balance sheet. Tesla&#39;s brand power, technological advancements, and economies of scale present a formidable obstacle for NIO&#39;s growth aspirations.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/033d3a63323a2085924b5aeb5227f2f6\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"491\" tg-height=\"432\"/><span>Seeking Alpha</span></p><p>The emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO&#39;s market share and pricing power.</p><p>NIO&#39;s attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla&#39;s plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec4e38603890600b4372bf41f7a5c080\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"204\"/><span>Seeking Alpha</span></p><p>Due to NIO&#39;s weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market&#39;s cautious stance on NIO.</p><h3 id=\"id_344676228\">Intrinsic value calculation</h3><p>It is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO&#39;s WACC is 9.59% and the logic behind is outlined in the below working.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/d8cd7881e1edcbd9de45374095e70aef\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"358\"/><span>DT Invest</span></p><p>The year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.</p><p>As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notable</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/4713289dbe2c4158d53b357b109e0dff\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"431\"/><span>DT Invest</span></p><p>The notable overvaluation assertion is also supported by NIO&#39;s sky-high Price/Book ratios, substantially higher compared to the sector median.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/88737da4ee3149562777b9e3f02c13ae\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"607\" tg-height=\"61\"/><span>Seeking Alpha</span></p><h3 id=\"id_3234834443\">What can go wrong with my thesis?</h3><p>Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.</p><p>A notable potential positive catalyst is NIO&#39;s joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.</p><p>Another potential positive development is NIO&#39;s strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.</p><h2 id=\"id_3760190078\">Summary</h2><p>NIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.</p></body></html>","source":"lsy1728464409321","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>NIO: Poised To Struggle Further</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nNIO: Poised To Struggle Further\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-19 10:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy ...</p>\n\n<a href=\"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09866":"蔚来-SW","NIO.SI":"蔚来","NIO":"蔚来"},"source_url":"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1123995557","content_text":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO's market position and growth prospects.Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company's significant fundamental issues.NIO\"s store with electric car insideMy thesisDespite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company's prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.NIO stock analysisNIO is fundamentally weak, which can be seen from some large warning trends. The company's financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company's business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.Data by YChartsAs a result, NIO's cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO's cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company's financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.Data by YChartsAnother big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.Data by YChartsFurthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO's R&D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO's financial position cannot be compared to Tesla's fortress balance sheet. Tesla's brand power, technological advancements, and economies of scale present a formidable obstacle for NIO's growth aspirations.Seeking AlphaThe emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO's market share and pricing power.NIO's attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla's plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.Seeking AlphaDue to NIO's weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market's cautious stance on NIO.Intrinsic value calculationIt is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO's WACC is 9.59% and the logic behind is outlined in the below working.DT InvestThe year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notableDT InvestThe notable overvaluation assertion is also supported by NIO's sky-high Price/Book ratios, substantially higher compared to the sector median.Seeking AlphaWhat can go wrong with my thesis?Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.A notable potential positive catalyst is NIO's joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.Another potential positive development is NIO's strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.SummaryNIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":384711534596512,"gmtCreate":1734943212760,"gmtModify":1735023525035,"author":{"id":"3574147611851381","authorId":"3574147611851381","name":"simonwyj","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":5,"crmLevelSwitch":0,"authorIdStr":"3574147611851381","idStr":"3574147611851381"},"htmlText":"CATL also reaffirm NIO battery model by entering this market and market is big enough like petrol station with 3-5 players. So those car with battery swap bring many benefits to car purchaser. It will be a trend. CYVN is huge and long term. Given NIo market present and approval from user, government bodies and car safety rating agency. Nio is poised for further growth. i am an avid BMW fan and driving BMW many years. I went to Beijing this year to check out Nio car personally ( I am a Malaysian ) , I would definitely upgrade to NIo from BMW. BMW technology is at least 3 years behind NIo. Needless to say one should wonder why a new brand like Nio could master 45% in the premium market compete against the like of BMW, Mercedes and Audi. Now by lowering their price BBA could only maintain and","listText":"CATL also reaffirm NIO battery model by entering this market and market is big enough like petrol station with 3-5 players. So those car with battery swap bring many benefits to car purchaser. It will be a trend. CYVN is huge and long term. Given NIo market present and approval from user, government bodies and car safety rating agency. Nio is poised for further growth. i am an avid BMW fan and driving BMW many years. I went to Beijing this year to check out Nio car personally ( I am a Malaysian ) , I would definitely upgrade to NIo from BMW. BMW technology is at least 3 years behind NIo. Needless to say one should wonder why a new brand like Nio could master 45% in the premium market compete against the like of BMW, Mercedes and Audi. Now by lowering their price BBA could only maintain and","text":"CATL also reaffirm NIO battery model by entering this market and market is big enough like petrol station with 3-5 players. So those car with battery swap bring many benefits to car purchaser. It will be a trend. CYVN is huge and long term. Given NIo market present and approval from user, government bodies and car safety rating agency. Nio is poised for further growth. i am an avid BMW fan and driving BMW many years. I went to Beijing this year to check out Nio car personally ( I am a Malaysian ) , I would definitely upgrade to NIo from BMW. BMW technology is at least 3 years behind NIo. Needless to say one should wonder why a new brand like Nio could master 45% in the premium market compete against the like of BMW, Mercedes and Audi. Now by lowering their price BBA could only maintain and","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":29,"commentSize":2,"repostSize":1,"link":"https://ttm.financial/post/384711534596512","repostId":1123995557,"repostType":2,"repost":{"id":"1123995557","kind":"news","pubTimestamp":1734576729,"share":"https://ttm.financial/m/news/1123995557?lang=&edition=fundamental","pubTime":"2024-12-19 10:52","market":"hk","language":"en","title":"NIO: Poised To Struggle Further","url":"https://stock-news.laohu8.com/highlight/detail?id=1123995557","media":"Seeking Alpha","summary":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy aut","content":"<html><head></head><body><h2 id=\"id_1605177943\">Summary</h2><ul style=\"\"><li><p>NIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.</p></li><li><p>Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO&#39;s market position and growth prospects.</p></li><li><p>Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.</p></li><li><p>Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company&#39;s significant fundamental issues.</p></li></ul><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/3b916cc6035194092506e491862a7d83\" alt=\"NIO&#34;s store with electric car inside\" title=\"NIO&#34;s store with electric car inside\" tg-width=\"750\" tg-height=\"500\"/><span>NIO&#34;s store with electric car inside</span></p><h2 id=\"id_1796068409\">My thesis</h2><p>Despite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company&#39;s prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.</p><h3 id=\"id_3185497874\">NIO stock analysis</h3><p>NIO is fundamentally weak, which can be seen from some large warning trends. The company&#39;s financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.</p><p>The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company&#39;s business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/84bed80e72783706fa357e4ab48c0a43\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>As a result, NIO&#39;s cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO&#39;s cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company&#39;s financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/23f1ccd1de0367a5c3b57fac6b6d1aa4\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"424\"/><span>Data by YCharts</span></p><p>Another big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec8b1ccdefaeaa9780ddf5300bc4c2ef\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>Furthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO&#39;s R&amp;D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO&#39;s financial position cannot be compared to Tesla&#39;s fortress balance sheet. Tesla&#39;s brand power, technological advancements, and economies of scale present a formidable obstacle for NIO&#39;s growth aspirations.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/033d3a63323a2085924b5aeb5227f2f6\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"491\" tg-height=\"432\"/><span>Seeking Alpha</span></p><p>The emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO&#39;s market share and pricing power.</p><p>NIO&#39;s attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla&#39;s plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec4e38603890600b4372bf41f7a5c080\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"204\"/><span>Seeking Alpha</span></p><p>Due to NIO&#39;s weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market&#39;s cautious stance on NIO.</p><h3 id=\"id_344676228\">Intrinsic value calculation</h3><p>It is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO&#39;s WACC is 9.59% and the logic behind is outlined in the below working.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/d8cd7881e1edcbd9de45374095e70aef\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"358\"/><span>DT Invest</span></p><p>The year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.</p><p>As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notable</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/4713289dbe2c4158d53b357b109e0dff\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"431\"/><span>DT Invest</span></p><p>The notable overvaluation assertion is also supported by NIO&#39;s sky-high Price/Book ratios, substantially higher compared to the sector median.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/88737da4ee3149562777b9e3f02c13ae\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"607\" tg-height=\"61\"/><span>Seeking Alpha</span></p><h3 id=\"id_3234834443\">What can go wrong with my thesis?</h3><p>Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.</p><p>A notable potential positive catalyst is NIO&#39;s joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.</p><p>Another potential positive development is NIO&#39;s strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.</p><h2 id=\"id_3760190078\">Summary</h2><p>NIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.</p></body></html>","source":"lsy1728464409321","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>NIO: Poised To Struggle Further</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nNIO: Poised To Struggle Further\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-19 10:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy ...</p>\n\n<a href=\"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09866":"蔚来-SW","NIO.SI":"蔚来","NIO":"蔚来"},"source_url":"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1123995557","content_text":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO's market position and growth prospects.Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company's significant fundamental issues.NIO\"s store with electric car insideMy thesisDespite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company's prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.NIO stock analysisNIO is fundamentally weak, which can be seen from some large warning trends. The company's financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company's business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.Data by YChartsAs a result, NIO's cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO's cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company's financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.Data by YChartsAnother big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.Data by YChartsFurthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO's R&D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO's financial position cannot be compared to Tesla's fortress balance sheet. Tesla's brand power, technological advancements, and economies of scale present a formidable obstacle for NIO's growth aspirations.Seeking AlphaThe emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO's market share and pricing power.NIO's attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla's plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.Seeking AlphaDue to NIO's weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market's cautious stance on NIO.Intrinsic value calculationIt is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO's WACC is 9.59% and the logic behind is outlined in the below working.DT InvestThe year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notableDT InvestThe notable overvaluation assertion is also supported by NIO's sky-high Price/Book ratios, substantially higher compared to the sector median.Seeking AlphaWhat can go wrong with my thesis?Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.A notable potential positive catalyst is NIO's joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.Another potential positive development is NIO's strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.SummaryNIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":385084261773504,"gmtCreate":1735025774723,"gmtModify":1735026306461,"authorId":3574147611851381,"author":{"id":3574147611851381,"idStr":"3574147611851381","authorId":3574147611851381,"name":"simonwyj","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":5,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":384711534596512,"type":1,"supId":0,"prevId":0,"content":"Hi Authur, i am jot surprising, there are market manipulators who knows how deep is their pocket. Check out how George Soros plan 2 years to take down Hong Kong stock, currency and future market in 1998 August. He levearge up to store 100billion HK dollar. It is legendary. How HK stock index went from 16k to 6.7k. So as long as Nio is still unprofitable, they will continue to bet aginst it. Do we believe in What Nio doing , they are in real business creating value and making a difference to society. We will see, patience and discipline are the most virtue in stock investment. However, as Nio keep pushing to cover more market and keep listening to Nio buyer and creating value. Is matter of time the table will flip in 2025/2026. However it doesn’t mean you dont carry risk with Nio, as there is political agenda and this manipulators constant threat. So do your due diligence. I can share more balance insight but do our own due diligence. All the best. ","text":"Hi Authur, i am jot surprising, there are market manipulators who knows how deep is their pocket. Check out how George Soros plan 2 years to take down Hong Kong stock, currency and future market in 1998 August. He levearge up to store 100billion HK dollar. It is legendary. How HK stock index went from 16k to 6.7k. So as long as Nio is still unprofitable, they will continue to bet aginst it. Do we believe in What Nio doing , they are in real business creating value and making a difference to society. We will see, patience and discipline are the most virtue in stock investment. However, as Nio keep pushing to cover more market and keep listening to Nio buyer and creating value. Is matter of time the table will flip in 2025/2026. However it doesn’t mean you dont carry risk with Nio, as there is political agenda and this manipulators constant threat. So do your due diligence. I can share more balance insight but do our own due diligence. All the best. ","html":"Hi Authur, i am jot surprising, there are market manipulators who knows how deep is their pocket. Check out how George Soros plan 2 years to take down Hong Kong stock, currency and future market in 1998 August. He levearge up to store 100billion HK dollar. It is legendary. How HK stock index went from 16k to 6.7k. So as long as Nio is still unprofitable, they will continue to bet aginst it. Do we believe in What Nio doing , they are in real business creating value and making a difference to society. We will see, patience and discipline are the most virtue in stock investment. However, as Nio keep pushing to cover more market and keep listening to Nio buyer and creating value. Is matter of time the table will flip in 2025/2026. However it doesn’t mean you dont carry risk with Nio, as there is political agenda and this manipulators constant threat. So do your due diligence. I can share more balance insight but do our own due diligence. All the best. "},{"id":385081902469688,"gmtCreate":1735023713462,"gmtModify":1735023718273,"authorId":10000000000010976,"author":{"id":10000000000010976,"idStr":"10000000000010975","authorId":10000000000010976,"name":"gogoooCn","avatar":"https://static.tigerbbs.com/b17af8d14081700b793911bb75de6b67","vip":8,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":384711534596512,"type":1,"supId":0,"prevId":0,"content":"Wow, very impressive research. But why my NIO has been lying down for so long <span class=\"teditor-emoji\">[Cry]</span><span class=\"teditor-emoji\">[Cry]</span>","text":"Wow, very impressive research. But why my NIO has been lying down for so long <span class=\"teditor-emoji\">[Cry]</span><span class=\"teditor-emoji\">[Cry]</span>","html":"Wow, very impressive research. But why my NIO has been lying down for so long <span class=\"teditor-emoji\">[Cry]</span><span class=\"teditor-emoji\">[Cry]</span>"}],"langContent":"EN"},{"id":384706286989368,"gmtCreate":1734941844829,"gmtModify":1735023922475,"author":{"id":"3574147611851381","authorId":"3574147611851381","name":"simonwyj","avatar":"https://static.laohu8.com/default-avatar.jpg","vip":1,"crmLevel":5,"crmLevelSwitch":0,"authorIdStr":"3574147611851381","idStr":"3574147611851381"},"htmlText":"I think the analysis is load sided. For Nio pricing if they sell 1 Nio and 1 Onvo. The revenue is equivalent to 3.5&nbsp;Xpeng cars ( g series plus cheap Mona ). So in terms of margin, with Onvo ramp up , they should edge Xpeng margin as well both in revenue and margin.&nbsp; Yes competition is going greater is given. But at the same times there are many ev companies also have gone out of business.&nbsp; With superior technology, greater value offered by Nio and other EV, legacy auto are dying given their slow response and not so great after sales service compared to Nio and Onvo. That is why we are seeing other legacy auto sales volume dropping greatly and pull out of market because not only is their price high but they are old technology. ET9 1st edition 999 units fully sold and order is","listText":"I think the analysis is load sided. For Nio pricing if they sell 1 Nio and 1 Onvo. The revenue is equivalent to 3.5&nbsp;Xpeng cars ( g series plus cheap Mona ). So in terms of margin, with Onvo ramp up , they should edge Xpeng margin as well both in revenue and margin.&nbsp; Yes competition is going greater is given. But at the same times there are many ev companies also have gone out of business.&nbsp; With superior technology, greater value offered by Nio and other EV, legacy auto are dying given their slow response and not so great after sales service compared to Nio and Onvo. That is why we are seeing other legacy auto sales volume dropping greatly and pull out of market because not only is their price high but they are old technology. ET9 1st edition 999 units fully sold and order is","text":"I think the analysis is load sided. For Nio pricing if they sell 1 Nio and 1 Onvo. The revenue is equivalent to 3.5 Xpeng cars ( g series plus cheap Mona ). So in terms of margin, with Onvo ramp up , they should edge Xpeng margin as well both in revenue and margin. Yes competition is going greater is given. But at the same times there are many ev companies also have gone out of business. With superior technology, greater value offered by Nio and other EV, legacy auto are dying given their slow response and not so great after sales service compared to Nio and Onvo. That is why we are seeing other legacy auto sales volume dropping greatly and pull out of market because not only is their price high but they are old technology. ET9 1st edition 999 units fully sold and order is","images":[],"top":1,"highlighted":1,"essential":2,"paper":1,"likeSize":20,"commentSize":3,"repostSize":0,"link":"https://ttm.financial/post/384706286989368","repostId":1123995557,"repostType":2,"repost":{"id":"1123995557","kind":"news","pubTimestamp":1734576729,"share":"https://ttm.financial/m/news/1123995557?lang=&edition=fundamental","pubTime":"2024-12-19 10:52","market":"hk","language":"en","title":"NIO: Poised To Struggle Further","url":"https://stock-news.laohu8.com/highlight/detail?id=1123995557","media":"Seeking Alpha","summary":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy aut","content":"<html><head></head><body><h2 id=\"id_1605177943\">Summary</h2><ul style=\"\"><li><p>NIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.</p></li><li><p>Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO&#39;s market position and growth prospects.</p></li><li><p>Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.</p></li><li><p>Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company&#39;s significant fundamental issues.</p></li></ul><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/3b916cc6035194092506e491862a7d83\" alt=\"NIO&#34;s store with electric car inside\" title=\"NIO&#34;s store with electric car inside\" tg-width=\"750\" tg-height=\"500\"/><span>NIO&#34;s store with electric car inside</span></p><h2 id=\"id_1796068409\">My thesis</h2><p>Despite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company&#39;s prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.</p><h3 id=\"id_3185497874\">NIO stock analysis</h3><p>NIO is fundamentally weak, which can be seen from some large warning trends. The company&#39;s financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.</p><p>The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company&#39;s business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/84bed80e72783706fa357e4ab48c0a43\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>As a result, NIO&#39;s cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO&#39;s cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company&#39;s financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/23f1ccd1de0367a5c3b57fac6b6d1aa4\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"424\"/><span>Data by YCharts</span></p><p>Another big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec8b1ccdefaeaa9780ddf5300bc4c2ef\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>Furthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO&#39;s R&amp;D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO&#39;s financial position cannot be compared to Tesla&#39;s fortress balance sheet. Tesla&#39;s brand power, technological advancements, and economies of scale present a formidable obstacle for NIO&#39;s growth aspirations.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/033d3a63323a2085924b5aeb5227f2f6\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"491\" tg-height=\"432\"/><span>Seeking Alpha</span></p><p>The emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO&#39;s market share and pricing power.</p><p>NIO&#39;s attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla&#39;s plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec4e38603890600b4372bf41f7a5c080\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"204\"/><span>Seeking Alpha</span></p><p>Due to NIO&#39;s weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market&#39;s cautious stance on NIO.</p><h3 id=\"id_344676228\">Intrinsic value calculation</h3><p>It is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO&#39;s WACC is 9.59% and the logic behind is outlined in the below working.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/d8cd7881e1edcbd9de45374095e70aef\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"358\"/><span>DT Invest</span></p><p>The year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.</p><p>As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notable</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/4713289dbe2c4158d53b357b109e0dff\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"431\"/><span>DT Invest</span></p><p>The notable overvaluation assertion is also supported by NIO&#39;s sky-high Price/Book ratios, substantially higher compared to the sector median.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/88737da4ee3149562777b9e3f02c13ae\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"607\" tg-height=\"61\"/><span>Seeking Alpha</span></p><h3 id=\"id_3234834443\">What can go wrong with my thesis?</h3><p>Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.</p><p>A notable potential positive catalyst is NIO&#39;s joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.</p><p>Another potential positive development is NIO&#39;s strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.</p><h2 id=\"id_3760190078\">Summary</h2><p>NIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.</p></body></html>","source":"lsy1728464409321","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>NIO: Poised To Struggle Further</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nNIO: Poised To Struggle Further\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-19 10:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy ...</p>\n\n<a href=\"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09866":"蔚来-SW","NIO.SI":"蔚来","NIO":"蔚来"},"source_url":"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1123995557","content_text":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO's market position and growth prospects.Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company's significant fundamental issues.NIO\"s store with electric car insideMy thesisDespite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company's prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.NIO stock analysisNIO is fundamentally weak, which can be seen from some large warning trends. The company's financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company's business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.Data by YChartsAs a result, NIO's cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO's cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company's financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.Data by YChartsAnother big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.Data by YChartsFurthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO's R&D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO's financial position cannot be compared to Tesla's fortress balance sheet. Tesla's brand power, technological advancements, and economies of scale present a formidable obstacle for NIO's growth aspirations.Seeking AlphaThe emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO's market share and pricing power.NIO's attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla's plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.Seeking AlphaDue to NIO's weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market's cautious stance on NIO.Intrinsic value calculationIt is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO's WACC is 9.59% and the logic behind is outlined in the below working.DT InvestThe year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notableDT InvestThe notable overvaluation assertion is also supported by NIO's sky-high Price/Book ratios, substantially higher compared to the sector median.Seeking AlphaWhat can go wrong with my thesis?Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.A notable potential positive catalyst is NIO's joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.Another potential positive development is NIO's strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.SummaryNIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":385147519640120,"gmtCreate":1735039733279,"gmtModify":1735039738033,"authorId":10000000000010940,"author":{"id":10000000000010940,"idStr":"10000000000010939","authorId":10000000000010940,"name":"Wheretotravel","avatar":"https://static.tigerbbs.com/1745be7ac8199c6c2e3618db776a5bdb","vip":8,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":384706286989368,"type":1,"supId":0,"prevId":0,"content":"Brilliantly written. Your posts on stock performance are always full of wisdom and positivity","text":"Brilliantly written. Your posts on stock performance are always full of wisdom and positivity","html":"Brilliantly written. Your posts on stock performance are always full of wisdom and positivity"},{"id":385146710270056,"gmtCreate":1735039708613,"gmtModify":1735039713384,"authorId":10000000000010940,"author":{"id":10000000000010940,"idStr":"10000000000010939","authorId":10000000000010940,"name":"Wheretotravel","avatar":"https://static.tigerbbs.com/1745be7ac8199c6c2e3618db776a5bdb","vip":8,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":384706286989368,"type":1,"supId":0,"prevId":0,"content":"You have a knack for simplifying complex financial topics. Thanks for the great insights","text":"You have a knack for simplifying complex financial topics. Thanks for the great insights","html":"You have a knack for simplifying complex financial topics. Thanks for the great insights"},{"id":385083620971064,"gmtCreate":1735024133019,"gmtModify":1735024137904,"authorId":4195362055063892,"author":{"id":4195362055063892,"idStr":"4195362055063892","authorId":4195362055063892,"name":"Tigerous","avatar":"https://community-static.tradeup.com/news/1cc88e6e01866542324985e4c7ce6394","vip":1,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":384706286989368,"type":1,"supId":0,"prevId":0,"content":"how abt  <a class=\"teditor-mention\" data-mention-id=\"TSLA\" data-mention-name=\"Tesla Motors\" href=\"https://ttm.financial/S/TSLA\">$Tesla Motors(TSLA)$</a> then","text":"how abt  <a class=\"teditor-mention\" data-mention-id=\"TSLA\" data-mention-name=\"Tesla Motors\" href=\"https://ttm.financial/S/TSLA\">$Tesla Motors(TSLA)$</a> then","html":"how abt  <a class=\"teditor-mention\" data-mention-id=\"TSLA\" data-mention-name=\"Tesla Motors\" href=\"https://ttm.financial/S/TSLA\">$Tesla Motors(TSLA)$</a> then"}],"langContent":"EN"},{"id":383796634489352,"gmtCreate":1734741670223,"gmtModify":1734741674031,"author":{"id":"3581582741176868","authorId":"3581582741176868","name":"Meoooow","avatar":"https://community-static.tradeup.com/news/c0057abac9f2fb5047a719b0c0f8803f","vip":1,"crmLevel":4,"crmLevelSwitch":1,"authorIdStr":"3581582741176868","idStr":"3581582741176868"},"htmlText":"Waiting to sell $7 next year in line with your sell call.&nbsp;","listText":"Waiting to sell $7 next year in line with your sell call.&nbsp;","text":"Waiting to sell $7 next year in line with your sell call.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/383796634489352","repostId":1123995557,"repostType":2,"repost":{"id":"1123995557","kind":"news","pubTimestamp":1734576729,"share":"https://ttm.financial/m/news/1123995557?lang=&edition=fundamental","pubTime":"2024-12-19 10:52","market":"hk","language":"en","title":"NIO: Poised To Struggle Further","url":"https://stock-news.laohu8.com/highlight/detail?id=1123995557","media":"Seeking Alpha","summary":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy aut","content":"<html><head></head><body><h2 id=\"id_1605177943\">Summary</h2><ul style=\"\"><li><p>NIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.</p></li><li><p>Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO&#39;s market position and growth prospects.</p></li><li><p>Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.</p></li><li><p>Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company&#39;s significant fundamental issues.</p></li></ul><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/3b916cc6035194092506e491862a7d83\" alt=\"NIO&#34;s store with electric car inside\" title=\"NIO&#34;s store with electric car inside\" tg-width=\"750\" tg-height=\"500\"/><span>NIO&#34;s store with electric car inside</span></p><h2 id=\"id_1796068409\">My thesis</h2><p>Despite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company&#39;s prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.</p><h3 id=\"id_3185497874\">NIO stock analysis</h3><p>NIO is fundamentally weak, which can be seen from some large warning trends. The company&#39;s financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.</p><p>The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company&#39;s business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/84bed80e72783706fa357e4ab48c0a43\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>As a result, NIO&#39;s cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO&#39;s cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company&#39;s financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/23f1ccd1de0367a5c3b57fac6b6d1aa4\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"424\"/><span>Data by YCharts</span></p><p>Another big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec8b1ccdefaeaa9780ddf5300bc4c2ef\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>Furthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO&#39;s R&amp;D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO&#39;s financial position cannot be compared to Tesla&#39;s fortress balance sheet. Tesla&#39;s brand power, technological advancements, and economies of scale present a formidable obstacle for NIO&#39;s growth aspirations.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/033d3a63323a2085924b5aeb5227f2f6\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"491\" tg-height=\"432\"/><span>Seeking Alpha</span></p><p>The emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO&#39;s market share and pricing power.</p><p>NIO&#39;s attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla&#39;s plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec4e38603890600b4372bf41f7a5c080\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"204\"/><span>Seeking Alpha</span></p><p>Due to NIO&#39;s weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market&#39;s cautious stance on NIO.</p><h3 id=\"id_344676228\">Intrinsic value calculation</h3><p>It is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO&#39;s WACC is 9.59% and the logic behind is outlined in the below working.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/d8cd7881e1edcbd9de45374095e70aef\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"358\"/><span>DT Invest</span></p><p>The year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.</p><p>As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notable</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/4713289dbe2c4158d53b357b109e0dff\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"431\"/><span>DT Invest</span></p><p>The notable overvaluation assertion is also supported by NIO&#39;s sky-high Price/Book ratios, substantially higher compared to the sector median.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/88737da4ee3149562777b9e3f02c13ae\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"607\" tg-height=\"61\"/><span>Seeking Alpha</span></p><h3 id=\"id_3234834443\">What can go wrong with my thesis?</h3><p>Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.</p><p>A notable potential positive catalyst is NIO&#39;s joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.</p><p>Another potential positive development is NIO&#39;s strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.</p><h2 id=\"id_3760190078\">Summary</h2><p>NIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.</p></body></html>","source":"lsy1728464409321","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>NIO: Poised To Struggle Further</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nNIO: Poised To Struggle Further\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-19 10:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy ...</p>\n\n<a href=\"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09866":"蔚来-SW","NIO.SI":"蔚来","NIO":"蔚来"},"source_url":"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1123995557","content_text":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO's market position and growth prospects.Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company's significant fundamental issues.NIO\"s store with electric car insideMy thesisDespite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company's prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.NIO stock analysisNIO is fundamentally weak, which can be seen from some large warning trends. The company's financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company's business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.Data by YChartsAs a result, NIO's cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO's cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company's financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.Data by YChartsAnother big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.Data by YChartsFurthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO's R&D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO's financial position cannot be compared to Tesla's fortress balance sheet. Tesla's brand power, technological advancements, and economies of scale present a formidable obstacle for NIO's growth aspirations.Seeking AlphaThe emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO's market share and pricing power.NIO's attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla's plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.Seeking AlphaDue to NIO's weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market's cautious stance on NIO.Intrinsic value calculationIt is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO's WACC is 9.59% and the logic behind is outlined in the below working.DT InvestThe year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notableDT InvestThe notable overvaluation assertion is also supported by NIO's sky-high Price/Book ratios, substantially higher compared to the sector median.Seeking AlphaWhat can go wrong with my thesis?Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.A notable potential positive catalyst is NIO's joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.Another potential positive development is NIO's strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.SummaryNIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":383293866876968,"gmtCreate":1734582711316,"gmtModify":1734585071707,"author":{"id":"3581582741176868","authorId":"3581582741176868","name":"Meoooow","avatar":"https://community-static.tradeup.com/news/c0057abac9f2fb5047a719b0c0f8803f","vip":1,"crmLevel":4,"crmLevelSwitch":1,"authorIdStr":"3581582741176868","idStr":"3581582741176868"},"htmlText":"Why don't post this when Nio is above $7? I would have sold everything then.&nbsp; Giving a few more&nbsp;kicks when it's down seems to be in line with shortsellers.&nbsp; Now&nbsp; I think Nio cannot break out of $5 this year.&nbsp; Hope next year Nio can show better performance.&nbsp; Nio believers can give more support?&nbsp; I'm still waiting for a Christmas cheer. 🎄🎄🎄","listText":"Why don't post this when Nio is above $7? I would have sold everything then.&nbsp; Giving a few more&nbsp;kicks when it's down seems to be in line with shortsellers.&nbsp; Now&nbsp; I think Nio cannot break out of $5 this year.&nbsp; Hope next year Nio can show better performance.&nbsp; Nio believers can give more support?&nbsp; I'm still waiting for a Christmas cheer. 🎄🎄🎄","text":"Why don't post this when Nio is above $7? I would have sold everything then. Giving a few more kicks when it's down seems to be in line with shortsellers. Now I think Nio cannot break out of $5 this year. Hope next year Nio can show better performance. Nio believers can give more support? I'm still waiting for a Christmas cheer. 🎄🎄🎄","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/383293866876968","repostId":1123995557,"repostType":2,"repost":{"id":"1123995557","kind":"news","pubTimestamp":1734576729,"share":"https://ttm.financial/m/news/1123995557?lang=&edition=fundamental","pubTime":"2024-12-19 10:52","market":"hk","language":"en","title":"NIO: Poised To Struggle Further","url":"https://stock-news.laohu8.com/highlight/detail?id=1123995557","media":"Seeking Alpha","summary":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy aut","content":"<html><head></head><body><h2 id=\"id_1605177943\">Summary</h2><ul style=\"\"><li><p>NIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.</p></li><li><p>Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO&#39;s market position and growth prospects.</p></li><li><p>Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.</p></li><li><p>Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company&#39;s significant fundamental issues.</p></li></ul><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/3b916cc6035194092506e491862a7d83\" alt=\"NIO&#34;s store with electric car inside\" title=\"NIO&#34;s store with electric car inside\" tg-width=\"750\" tg-height=\"500\"/><span>NIO&#34;s store with electric car inside</span></p><h2 id=\"id_1796068409\">My thesis</h2><p>Despite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company&#39;s prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.</p><h3 id=\"id_3185497874\">NIO stock analysis</h3><p>NIO is fundamentally weak, which can be seen from some large warning trends. The company&#39;s financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.</p><p>The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company&#39;s business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/84bed80e72783706fa357e4ab48c0a43\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>As a result, NIO&#39;s cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO&#39;s cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company&#39;s financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/23f1ccd1de0367a5c3b57fac6b6d1aa4\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"424\"/><span>Data by YCharts</span></p><p>Another big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec8b1ccdefaeaa9780ddf5300bc4c2ef\" alt=\"Data by YCharts\" title=\"Data by YCharts\" tg-width=\"635\" tg-height=\"439\"/><span>Data by YCharts</span></p><p>Furthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO&#39;s R&amp;D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO&#39;s financial position cannot be compared to Tesla&#39;s fortress balance sheet. Tesla&#39;s brand power, technological advancements, and economies of scale present a formidable obstacle for NIO&#39;s growth aspirations.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/033d3a63323a2085924b5aeb5227f2f6\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"491\" tg-height=\"432\"/><span>Seeking Alpha</span></p><p>The emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO&#39;s market share and pricing power.</p><p>NIO&#39;s attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla&#39;s plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/ec4e38603890600b4372bf41f7a5c080\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"640\" tg-height=\"204\"/><span>Seeking Alpha</span></p><p>Due to NIO&#39;s weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market&#39;s cautious stance on NIO.</p><h3 id=\"id_344676228\">Intrinsic value calculation</h3><p>It is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO&#39;s WACC is 9.59% and the logic behind is outlined in the below working.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/d8cd7881e1edcbd9de45374095e70aef\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"358\"/><span>DT Invest</span></p><p>The year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.</p><p>As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notable</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/4713289dbe2c4158d53b357b109e0dff\" alt=\"DT Invest\" title=\"DT Invest\" tg-width=\"640\" tg-height=\"431\"/><span>DT Invest</span></p><p>The notable overvaluation assertion is also supported by NIO&#39;s sky-high Price/Book ratios, substantially higher compared to the sector median.</p><p class=\"t-img-caption\"><img src=\"https://community-static.tradeup.com/news/88737da4ee3149562777b9e3f02c13ae\" alt=\"Seeking Alpha\" title=\"Seeking Alpha\" tg-width=\"607\" tg-height=\"61\"/><span>Seeking Alpha</span></p><h3 id=\"id_3234834443\">What can go wrong with my thesis?</h3><p>Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.</p><p>A notable potential positive catalyst is NIO&#39;s joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.</p><p>Another potential positive development is NIO&#39;s strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.</p><h2 id=\"id_3760190078\">Summary</h2><p>NIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.</p></body></html>","source":"lsy1728464409321","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>NIO: Poised To Struggle Further</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nNIO: Poised To Struggle Further\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-12-19 10:52 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy ...</p>\n\n<a href=\"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"09866":"蔚来-SW","NIO.SI":"蔚来","NIO":"蔚来"},"source_url":"https://seekingalpha.com/article/4744983-nio-stock-poised-to-struggle-reiterate-strong-sell","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1123995557","content_text":"SummaryNIO remains fundamentally weak with persistent unprofitability, deteriorating net income, and a shrinking cash position, leading to a Strong Sell rating.Intensifying competition from legacy automakers, Tesla, and other Chinese EV brands further undermines NIO's market position and growth prospects.Intrinsic value analysis suggests NIO is overvalued by around 24%, with a calculated intrinsic value per share of $3.36.Potential positive catalysts like the NIO MENA joint venture and Mastercard partnership are unlikely to offset the company's significant fundamental issues.NIO\"s store with electric car insideMy thesisDespite the October share price spike, NIO (NYSE:NIO) currently trades 11% lower than it did when I shared my previous bearish call. NIO remains fundamentally weak, and I am still very pessimistic about the company's prospects. The competition continues intensifying fiercely, which is never a good development for a weakly positioned company like NIO. Moreover, my valuation analysis suggests that NIO is far from being called attractively valued. Due to all these unfavorable factors, I reiterate a Strong Sell rating on NIO.NIO stock analysisNIO is fundamentally weak, which can be seen from some large warning trends. The company's financial performance continues to be a major concern for investors. Despite having sold hundreds of thousands of vehicles and being in operation for several years, the company remains deeply unprofitable.The Q3 net income has deteriorated YoY by around $100 million despite revenue delivered modest growth. This persistent and growing loss indicates a fundamental issue with the company's business model, as it has failed to achieve operational efficiency or economies of scale despite its market presence.Data by YChartsAs a result, NIO's cash position is melting down. The company started this year with $7 billion in cash. By the end of Q3, NIO's cash position had decreased to $5.3 billion. This continuous cash burn not only undermines the company's financial flexibility, but also raises concerns about its ability to fund future operations and growth initiatives without resorting to further dilution of shareholder value through equity issuances or taking on additional debt.Data by YChartsAnother big warning sign is rapidly intensifying competition. The company faces fierce competition from established luxury automakers such as Mercedes-Benz, BMW, Audi, and Volkswagen, all of which are aggressively expanding their electric vehicle offerings. These legacy brands bring with them strong brand recognition and established distribution networks. These crucial factors make it difficult for NIO to carve out a substantial market share in the premium segment.Data by YChartsFurthermore, NIO must contend with Tesla, the global leader in electric vehicles, which has a strong presence in China and continues to innovate and expand its product line. NIO's R&D budget is several times lower compared to Tesla, which is a significant fundamental flaw for a company operating in a highly innovative industry like EV. In addition, NIO's financial position cannot be compared to Tesla's fortress balance sheet. Tesla's brand power, technological advancements, and economies of scale present a formidable obstacle for NIO's growth aspirations.Seeking AlphaThe emergence of other Chinese luxury EV brands, such as ZEEKR (55% YoY deliveries growth in Q3 2024) and Xpeng (16% YoY deliveries growth in Q3 2024). NIO struggles to compete with these two companies as its Q3 deliveries grew much slower at around 11% YoY. Local rivals are vying for the same customer base and are often able to offer comparable products at competitive prices, which erodes NIO's market share and pricing power.NIO's attempt to diversify its product portfolio with the introduction of its lower-end brand, ONVO, is unlikely to provide significant relief from competitive pressures. The mass-market EV segment is already crowded with established players like BYD (OTCPK:BYDDF) and numerous other budget Chinese brands. Moreover, Tesla's plans to launch a sub-$30,000 model in 2025 will likely add even more competition in this space.Seeking AlphaDue to NIO's weak fundamentals, its stock experiences weak momentum. Deep operating losses together with fierce competition looks like a very unfavorable combination, which explains the market's cautious stance on NIO.Intrinsic value calculationIt is always difficult to value a deeply unprofitable company like NIO, but I will try it using the discounted cash flow (DCF) approach. I usually figure out the discount rate by myself, and for NIO it is the weighted-average cost of capital (WACC). NIO's WACC is 9.59% and the logic behind is outlined in the below working.DT InvestThe year 1 revenue assumption is $9.44 billion and revenue CAGR for years beyond is 7.02%. Since my outlook is bearish, I have to balance out my bearishness in the DCF model with the aggressive perpetual growth rate, which I estimate at 4% due to solid secular trends in EV industry. Moreover, my aggressive DCF assumptions are supported by incorporating a yearly 100-bps FCF margin expansion.As a result, the intrinsic value per share is $3.36. The current share price is $4.42, meaning that the stock is overvalued by around 24%.The notableDT InvestThe notable overvaluation assertion is also supported by NIO's sky-high Price/Book ratios, substantially higher compared to the sector median.Seeking AlphaWhat can go wrong with my thesis?Even with all these problems on NIO’s plate, there are a few positive catalysts that may offset some of the bearish pressure. But you have to keep in mind that all of this is not likely to fully offset the fundamental issues plaguing the company.A notable potential positive catalyst is NIO's joint venture with CYVN Holdings to form NIO MENA, targeting the Middle East and North Africa market. This growth might open new revenue growth drivers for NIO and open up new markets. As a proposed new EV research, production and future product launch in the area could result in economies of scale and efficiency, they plan to cooperate on a new EV project. But the success of this project is hardly guaranteed, as the EV market is competitive worldwide and launching into new markets requires big investments.Another potential positive development is NIO's strategic partnership with Mastercard. The partnership will offer users globally value-added services and may allow NIO to expand into international markets. The agreement can bring new in-car payments and privileges to Mastercard cardholders, which will add value to NIO’s offering and loyalty. But the financial effects of this partnership have not been announced and might not be strong enough to relieve NIO of its profitability woes immediately.SummaryNIO remains a Strong Sell for me. Significant fundamental flaws like rapid cash burn together with weak positioning against the competition cannot be ignored alongside stock overvaluation.","news_type":1},"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"}],"hasMoreComments":true,"newsSizeData":{"likeSize":7,"commentSize":6,"repostSize":6,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false}}