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Why Nio Stock Faces an Uphill Battle

Chinese automaker Nio (NYSE:NIO) has several strengths, including its innovative battery-exchange program, significant sales growth and its pending expansion…

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Chinese automaker Nio (NYSE:NIO) has several strengths, including its innovative battery-exchange program, significant sales growth and its pending expansion into multiple overseas markets. Yet, NIO stock is down 50% in the past year.

A Nio (NIO) sign outside of the company's facilities in Shanghai, China.Source: Andy Feng / Shutterstock.com

Maybe that’s because in the past several months, the company’s sales growth and financial results haven’t been all that impressive. Or perhaps it’s because the electric vehicle maker faces extremely tough competition from the likes of Xpeng (NYSE:XPEV), Li Auto (NASDAQ:LI) and Tesla (NASDAQ:TSLA). Nio also seems to be significantly behind a number of its rivals when it comes to autonomous driving.

High Prices and Tough Competition

One thing that could hinder Nio going forward is the relatively high prices of its vehicles. The base prices for Nio’s EV lineup ranges from about $50,000 to roughly $70,000. Add in extras and customization and they can run upward of $80,000.

NIO’s latest model, the ET7, will cost customers about $68,710 and $77,640 depending on what battery pack they pick. And that’s after factoring in EV subsidies from the Chinese government.

For comparison, Xpeng’s after-subsidy base prices range from $23,000 to $36,000, while Tesla’s cheapest Model 3 starts at around $40,000.

Nio also faces a great deal of competition at the higher end of the EV market from some famous and well-regarded brands including BMW (OTC:BMWYY), Audi, Lincoln and Mercedes.

In China, where incomes are generally lower than in the U.S. and Western Europe, less expensive EVs have a much better chance of becoming bestsellers than their more costly peers. In the end, selling millions of EVs with, say, a 20% gross margin will prove more profitable than selling a few hundred thousand vehicles with, say, a 40% gross margin.

Nio Appears To Be Falling Behind in Autonomous Driving

It seems that Nio is well behind Xpeng and Tesla when it comes to autonomous driving. Last month, Barron’s reported: “NIO Autonomous Driving or NAD, as the company calls it, will maintain driving speeds and do some steering, but drivers still need to pay attention to the road at all times.” Doesn’t sound all that “autonomous” to me.

Meanwhile, in October, Xpeng released its Xpilot 3.5 version of its advanced driver-assistance system. “The system allows Xpeng’s cars to change lanes, speed up or slow down, or overtake cars and enter and exit highways,” according to CNBC.

And in November, Tesla started offering its Enhanced Autopilot system in China to some customers. According to Inside EVs, among the features offered by Tesla’s system are “Summon, Autopark, Auto Lane Change, and, most importantly, Navigate on Autopilot.”

You don’t have to be an expert on autonomous vehicles to see that Nio is trailing Xpeng and Tesla in this area by a significant margin.

Disappointing Sales Growth and Financial Results

For December, Nio reported that its deliveries had increased nearly 50% year over year to 10,489 EVs. That’s not terrible, but it was lower than the prior month’s 10,878 deliveries and a marked slowdown from November’s year-over-year growth of 106%.

It also paled in comparison to its competitors’ December growth. XPeng delivered 16,000 vehicles in December, up 181% from a year ago and 2.5% from November. And Li Auto saw its deliveries hit 14,087 in December, up 4.5% over November and 130% year over year.

Nio is expected to report fourth-quarter earnings next month. Management’s most recent guidance, released in November, of $1.46 billion to $1.56 billion fell short of analysts’ estimates of $1.75 billion. The consensus has since lowered its forecast, predicting Nio will earn $1.53 billion. That represents year-over-year growth of 49.5%, while full-year revenue is expected to increase 120% to $5.62 billion.

If the company fails to meet or beat these numbers, NIO stock could sell off sharply.

The Bottom Line on Nio Stock

Nio faces tough competition in the Chinese EV market and appears to be falling behind its competitors in terms of growth. The high price of Nio’s vehicles compared with some of its rivals’ and its relatively slow progress when it comes to self-driving technologies could cost the company its edge.

Shares are currently trading for five times analysts’ average 2022 revenue estimate, which could prove to be overly optimistic. NIO stock isn’t expensive for an EV name, but it isn’t cheap either. And that valuation appears to bake in a meaningful amount of sales growth for the automaker, both at home and overseas.

I recommend investors avoid NIO stock at this point.

On the date of publication, Larry Ramer held a long position in XPEV stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Larry Ramer has conducted research and written articles on U.S. stocks for 13 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015.  Among his highly successful, contrarian picks have been GE, solar stocks, and Snap. You can reach him on StockTwits at @larryramer. 

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Author: Larry Ramer

Energy & Critical Metals

Strategic Analysis of Smart Bicycle Market Key Technological Developments

The Smart Bicycle Market 2022 report provides a detailed analysis of the dynamic of the market with extensive focus on secondary research. The report sheds…

The Smart Bicycle Market 2022 report provides a detailed analysis of the dynamic of the market with extensive focus on secondary research. The report sheds light on the current situation of the market size, share, demand, development patterns, and forecast in the coming years.

This has brought along several changes in This report also covers the impact of COVID-19 on the global market.

The report Global Smart Bicycle Market analyzes the strategy patterns, and forecast in the coming years. The report evaluates the market size of the Global Smart Bicycle Market studies the strategy patterns adopted by the prominent international players.

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The report highlights the key players and manufacturers and the latest strategies including new product launches, partnerships, joint ventures, technology, segmentation in terms of region and industry competition, profit and loss ration, and investment ideas. A precise evaluation of effective manufacturing techniques, advertisement techniques, market share size, growth rate, size, revenue, sales and value chain analysis.

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Others

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Instead Of Walking
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North America (United States, Canada, Mexico)
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Asia Pacific (China, Japan, India, Korea)
Europe (Germany, UK, France, Italy)
Middle East Africa (Egypt, Turkey, Saudi Arabia, Iran) And More.

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Energy & Critical Metals

Asbestos Rope Market 2021 Analysis, Strategic Insights and Forecast to 2028

Get Sample Report   Purchase Complete Report Now Global Asbestos Rope Market research is an intelligence report with meticulous efforts undertaken to…

Global Asbestos Rope Market research is an intelligence report with meticulous efforts undertaken to study the right and valuable information. The data which has been looked upon is done considering both, the existing top players and the upcoming competitors. Business strategies of the key players and the new entering market industries are studied in detail. Well explained SWOT analysis, revenue share and contact information are shared in this report analysis. It also provides market information in terms of development and its capacities. 

MR Accuracy Reports crafted the report, titled Global Asbestos Rope Market 2021 is a methodical research study based on the Asbestos Rope Market , analyzing the competitive framework of the industry in the world. Using efficient analytical tools such as SWOT analysis and Porter’s five forces analysis, the report provides a comprehensive assessment of the Asbestos Rope Market . Our big research team were able to captured all-important chapters in the final report as they have been striving towards it.

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Asbestos rope, also known as aluminum silicate fiber rope, is made of asbestos twisted or braided rope made for a variety of thermal equipment and heat conduction system for thermal insulation or processing into other asbestos products, materials.Asbestos rope consists of 8 millimeter of not less than five stone cotton yarn, wire twisted and become, and more than 10 mm of not less than four stone cotton yarn, wire twisted and become, stone cotton yarn is made of asbestos fiber and other fibers blended into a single strand of yarn.

The report forecast global Asbestos Rope market to grow to reach xxx Million USD in 2020 with a CAGR of xx% during the period 2021E-2026F due to coronavirus situation.

The report offers detailed coverage of Asbestos Rope industry and main market trends with impact of coronavirus. The market research includes historical and forecast market data, demand, application details, price trends, and company shares of the leading Asbestos Rope by geography. The report splits the market size, by volume and value, on the basis of application type and geography.

First, this report covers the present status and the future prospects of the global Asbestos Rope market for 2016-2025.

And in this report, we analyze global market from 5 geographies: Asia-Pacific[China, Southeast Asia, India, Japan, Korea, Western Asia], Europe[Germany, UK, France, Italy, Russia, Spain, Netherlands, Turkey, Switzerland], North America[United States, Canada, Mexico], Middle East & Africa[GCC, North Africa, South Africa], South America[Brazil, Argentina, Columbia, Chile, Peru].

At the same time, we classify Asbestos Rope according to the type, application by geography. More importantly, the report includes major countries market based on the type and application.

Finally, the report provides detailed profile and data information analysis of leading Asbestos Rope company.

Key Content of Chapters as follows (Including and can be customized) :

Part 1:

Market Overview, Development, and Segment by Type, Application & Region

Part 2:

Company information, Sales, Cost, Margin etc.

Part 3:

Global Market by company, Type, Application & Geography

Part 4:

Asia-Pacific Market by Type, Application & Geography

Part 5:

Europe Market by Type, Application & Geography

Part 6:

North America Market by Type, Application & Geography

Part 7:

South America Market by Type, Application & Geography

Part 8:

Middle East & Africa Market by Type, Application & Geography

Part 9:

Market Features

Part 10:

Investment Opportunity

Part 11:

Conclusion

Market Segment as follows:

By Region

Asia-Pacific[China, Southeast Asia, India, Japan, Korea, Western Asia]

Europe[Germany, UK, France, Italy, Russia, Spain, Netherlands, Turkey, Switzerland]

North America[United States, Canada, Mexico]

Middle East & Africa[GCC, North Africa, South Africa]

South America[Brazil, Argentina, Columbia, Chile, Peru]

Key Companies

Shree Firepack Safety Private Limited

Samarth Industries

Balaji Enterprises, Pune

Supreme In Safety Services

National Safety Solution

Protector Fire & Safety

Hiren Industrial Corporation

Core Safety Group

Super Safety Services, Mumbai

Unique Udyog Mumbai

Speciality Safety Engineers

Perfect Welding Solutions

Oriental Enterprises

Yogdeep Enterprise

Atlas Tools Center

JAB Enterprises

Chongqing Jincan Insulation Material Co Ltd

Deqing Guotai Fireproof Material Factory

Cangzhou Yufeng Refractory Insulation Materials

Henan Xiayi Asbestos Products Factory

Yuyao Tianzhong Insulation Materials

Market by Type

Chrysotile

Amosite

Crocidolite

Anthophyllite asbestos

Actinolite asbestos

Tremolite asbestos

Market by Application

Textile

Building

Industrial

Others

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Key questions answered in the report include:

  • What will be the market size and the growth rate by the end of the forecast period?
  • What are the key Global Asbestos Rope Market trends impacting the growth of the market?
  • What are the potential growth opportunities and threats faced by the leading competitors in the market?
  • What are the key outcomes of Porter’s five forces analysis and the SWOT analysis of the key players functioning in the Global Asbestos Rope Market?
  • This report gives all the information regarding industry Overview, analysis and revenue of this market.
  • What are the market opportunities and threats faced by the vendors in the Global Asbestos Rope Market?

If you have any special requirements, please let us know and we will offer you the report as you want

You can buy the complete report @ https://www.mraccuracyreports.com/checkout/497602

About Us:

MR Accuracy Reports’ well-researched inputs that encompass domains ranging from IT to healthcare enable our prized clients to capitalize upon key growth opportunities and shield against credible threats prevalent in the market in the current scenario and those expected in the near future. Our research reports arm our clients with macro-level insights across various key global regions that equip them with a broader perspective to align their strategies to capitalize on lucrative growth opportunities in the market.

Contact Us:
MR Accuracy Reports,
USA: +1 804 500 1224
UK: +44 741841 3666
ASIA: +91 747888728100
Email: [email protected]   
Website: https://www.worldwidemarketreports.com

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Energy & Critical Metals

Aluminum Sulfate Market 2021: Technology Advancement, Trends, and Growth

Get Sample Report   Purchase Complete Report Now Global Aluminum Sulfate Market research is an intelligence report with meticulous efforts undertaken…

Global Aluminum Sulfate Market research is an intelligence report with meticulous efforts undertaken to study the right and valuable information. The data which has been looked upon is done considering both, the existing top players and the upcoming competitors. Business strategies of the key players and the new entering market industries are studied in detail. Well explained SWOT analysis, revenue share and contact information are shared in this report analysis. It also provides market information in terms of development and its capacities. 

MR Accuracy Reports crafted the report, titled Global Aluminum Sulfate Market 2021 is a methodical research study based on the Aluminum Sulfate Market , analyzing the competitive framework of the industry in the world. Using efficient analytical tools such as SWOT analysis and Porter’s five forces analysis, the report provides a comprehensive assessment of the Aluminum Sulfate Market . Our big research team were able to captured all-important chapters in the final report as they have been striving towards it.

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Aluminum Sulfate is a chemical compound with the formula Al2(SO4)3.It is soluble in water and is mainly used as a flocculating agent in the purification of drinking water and waste water treatment plants, and also in paper manufacturing.

The report forecast global Aluminum Sulfate market to grow to reach xxx Million USD in 2020 with a CAGR of xx% during the period 2021E-2026F due to coronavirus situation.

The report offers detailed coverage of Aluminum Sulfate industry and main market trends with impact of coronavirus. The market research includes historical and forecast market data, demand, application details, price trends, and company shares of the leading Aluminum Sulfate by geography. The report splits the market size, by volume and value, on the basis of application type and geography.

First, this report covers the present status and the future prospects of the global Aluminum Sulfate market for 2016-2025.

And in this report, we analyze global market from 5 geographies: Asia-Pacific[China, Southeast Asia, India, Japan, Korea, Western Asia], Europe[Germany, UK, France, Italy, Russia, Spain, Netherlands, Turkey, Switzerland], North America[United States, Canada, Mexico], Middle East & Africa[GCC, North Africa, South Africa], South America[Brazil, Argentina, Columbia, Chile, Peru].

At the same time, we classify Aluminum Sulfate according to the type, application by geography. More importantly, the report includes major countries market based on the type and application.

Finally, the report provides detailed profile and data information analysis of leading Aluminum Sulfate company.

Key Content of Chapters as follows (Including and can be customized) :

Part 1:

Market Overview, Development, and Segment by Type, Application & Region

Part 2:

Company information, Sales, Cost, Margin etc.

Part 3:

Global Market by company, Type, Application & Geography

Part 4:

Asia-Pacific Market by Type, Application & Geography

Part 5:

Europe Market by Type, Application & Geography

Part 6:

North America Market by Type, Application & Geography

Part 7:

South America Market by Type, Application & Geography

Part 8:

Middle East & Africa Market by Type, Application & Geography

Part 9:

Market Features

Part 10:

Investment Opportunity

Part 11:

Conclusion

Market Segment as follows:

By Region

Asia-Pacific[China, Southeast Asia, India, Japan, Korea, Western Asia]

Europe[Germany, UK, France, Italy, Russia, Spain, Netherlands, Turkey, Switzerland]

North America[United States, Canada, Mexico]

Middle East & Africa[GCC, North Africa, South Africa]

South America[Brazil, Argentina, Columbia, Chile, Peru]

Key Companies

SanDisk

Kingston

Toshiba

Netac

aigo

TECLAST

ADATA

HP

Market by Type

≤8G

16G

32G

≥64G

Market by Application

Enterprise

Personal

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Key questions answered in the report include:

  • What will be the market size and the growth rate by the end of the forecast period?
  • What are the key Global Aluminum Sulfate Market trends impacting the growth of the market?
  • What are the potential growth opportunities and threats faced by the leading competitors in the market?
  • What are the key outcomes of Porter’s five forces analysis and the SWOT analysis of the key players functioning in the Global Aluminum Sulfate Market?
  • This report gives all the information regarding industry Overview, analysis and revenue of this market.
  • What are the market opportunities and threats faced by the vendors in the Global Aluminum Sulfate Market?

If you have any special requirements, please let us know and we will offer you the report as you want

You can buy the complete report @ https://www.mraccuracyreports.com/checkout/497548

About Us:

MR Accuracy Reports’ well-researched inputs that encompass domains ranging from IT to healthcare enable our prized clients to capitalize upon key growth opportunities and shield against credible threats prevalent in the market in the current scenario and those expected in the near future. Our research reports arm our clients with macro-level insights across various key global regions that equip them with a broader perspective to align their strategies to capitalize on lucrative growth opportunities in the market.

Contact Us:
MR Accuracy Reports,
USA: +1 804 500 1224
UK: +44 741841 3666
ASIA: +91 747888728100
Email: [email protected]   
Website: https://www.mraccuracyreports.com

Continue Reading

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