NIO Stock News and Forecast: EV-maker tumbles 13% after disappointing earnings

Update March 3: Nio Inc (NYSE: NIO) has dropped by 13% on Tuesday following a disappointing earnings report. Enthusiasts who had jumped on the Chinese electric vehicle's stock rushed to the exits after NIo's earnings paled in comparison to those of rival Li Auto. As both carmakers compete in different niches, some thought that Li's success means Nio is also on a good footing. Wednesday's premarket data is pointing to a small bounce of 1.59% to $43.98. Even after this potential increase, Nio's value is only a third of its 52-week high of $66.99.

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NYSE:NIO has continued its up and down performance so far in 2021 with a whipsaw session on Monday as the company reported its Q4 earnings after the closing bell. NIO rocketed up by 8.69% during trading hours to close the day at $49.76, although that was the end of the good news for shareholders. It was the largest single day gain that NIO has had so far this year as 2021 has not been nearly as kind to the electric vehicle sector as 2020 was. 

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NIO’s much anticipated quarterly earnings report came after the trading session was over on Monday, and the results were mixed compared to previous blowout quarters. NIO reported $1.02 billion in revenue compared to Wall Street consensus estimates of $1.01 billion, and saw vehicle deliveries slow in February to 5,578 compared to 7,225 in January. Despite the drop off last month, the results are still good for triple digit year-over-year sales growth and its cash in hand doubled from $3.3 billion to $6.5 billion quarter-over-quarter. NIO did provide guidance for Q1 2021, with an estimated 20,000 vehicles to be delivered with revenues expected to be between $1.13 to $1.16 billion.

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The mixed results were magnified by the fact that Chinese rival Li Auto (NASDAQ:LI) reported a surprise profit as well as a rise in gross margins from 0.5% in 2019 to 16.4% in 2020. Li also expected better than expected revenues and vehicle deliveries, but it also saw its stock fall as the bar for quality earnings reports has certainly been raised in this bull market.

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Update March 2: Nio Inc (NYSE: NUI) is changing hands just under $47, a drop of around 6% as investors digest the firm's unimpressive earnings results. However, shares of the Shanghai-based company kicked off Tuesday's session at lower ground, below $45. The mediocre outcome stand out against better sales figures from Li Auto, a Chinese rival. Shares have a long way to run toward the 52-week high of $66.99.