The Nio Analyst
The Nio Thesis
Nio's outperformance relative to the industry reflected the company's efforts in promoting its products, technologies and services through online traffic channels, including the NIO app, Hsun Lee said.
The analyst also noted the company recently privately placed $235 million short-term convertible notes at $3.50 per ADS to several Asia-based financial investors.
"We believe the stock's fundamentals have bottomed out, but its volume sales are likely to be negatively impacted by the COVID-19 outbreak and the launch of Tesla's made-in-China Model 3," Hsun Lee wrote in a Tuesday note.
The company's improving product quality, according to BofA, is supported by the 100kWh battery pack and 20kW DC charing pile, also the third model – EC6 – and new ES8.
The faster than expected sale channel expansion and strengthening brand equity, however, is offset by potential financing risk, the firm added.
NIO Price Action
Nio shares were higher by 3.78% to $3.44 at time of publication.