Chinese manufacturer of electric vehicles
reported solid gains for the third quarter on Tuesday night. Still, the stock fell in trading after hours, falling by about 3%. But with the rise in NIO shares recently, a small decline is likely to be seen as a profit by shareholders.
NIO (ticker: NIO) reported a loss of 12 cents per share of $ 667 million in sales. Sales increased by 146% on an annual basis. Wall Street and overseas analysts were looking for a 19-cent loss per share of about $ 663 million in sales.
The results, compared to expectations, look solid, but the stock was lower mainly because the bar was set extremely high. NIO shares have ultimately risen 68% in the last month. The
Dow Jones Industrial Average,
for comparison, both added about 4% over the same period.
To date, NIO shares have added almost 1,100%. The NIO may have had to report something very special to see a big jump after profits.
In fact, this rebound may have occurred before earnings were reported. Peers from NIO
(LI) reported third quarter results only days ago. Shares of NIO have risen 10% since Xpeng, the first company to report, released the number on the morning of November 12. Shares of XPeng and Li added 33% and 44% respectively over the same period.
The stock response aside, the NIO quarterly report seems to check all the fields. In addition to sales growth, profit margins widened. “Our momentum for order growth has continued, driven by expanded brand awareness, a growing customer base, an expanded sales network and, most importantly, compelling products and technologies,” said CFO Stephen Way Feng in a company news release. “Meanwhile, our continued improvement in operational efficiency, cash flow and balance has laid a solid foundation for our future sustainable growth and decisive investment in technology.”
In the future, the company expects to deliver 16,500 to 17,000 vehicles in the fourth quarter. NIO delivered 12,206 vehicles in the third quarter. Its expected fourth-quarter third-quarter shipment growth looks slightly better than the guidance given by both XPeng and Li Auto.
Deliveries should result in sales of about $ 930 million, according to the company. This is also slightly better than analysts’ forecasts for the current quarter.
Where will the stocks go from here, someone suggests. The rally allowed shares to trade for approximately 15 times the sales of 2021. This is far higher than even
(TSLA) and far higher than NIO’s own trading history. The highest share price of NIO shares is around $ 46, very close to the closing level on Tuesday.
The company has scheduled a revenue conference for 7 p.m. Eastern Time to discuss the results. Analysts and investors will be eager to hear about future levels of production and demand for electric vehicles in China.
Write to Al Root at firstname.lastname@example.org