- NYSE: NIO has hit a record high of $11.51 following robust sales for the second quarter.
- The Chinese electric car maker benefits from a robust financial standing following government support.
- Elon Musk's Tesla, a competitor, is seen as overvalued by some and encourages investment in rivals.
Has NYSE: NIO at its peak? Shares of NIO Inc have closed at the highest ever on record, At Monday's closing price of $11.51, the Chinese electric carmaker's stock price has surpassed the previous peak of $10.60 recorded in March 2019.
Now valued at over $13 billion, can NYSE: NIO extend its gain? Looking at pre-market trading, it may endure a minor downward correction. Nevertheless, it has good reasons to rise.
NIO news today
The primary driver of NIO's ascent was its report of June's sales. Sales of EBs surged by 179% yearly and for the entirety of the second quarter, they are up around 191% in comparison to the parallel period in 2019. That is nearly tripling its sales.
Production in the Beijing-based company is working smoothly after China overcame the coronavirus crisis. The surge has shown NIO's resilience to the shock.
Full Q2 results are due out only at some point in August, but the company has a robust financial footing. While the company is trading in New York, it receives funding from the Chinese government. Backing from economic development authorities has allowed NIO to set up a new factory around Hefei, where it is based.
The third reason for the surge in NYSE: NIO stems from its competition. The No. 1 name in EVs is Tesla – owned by Elon Musk. The celebrity billionaire, who recently supported Kanye West's run for US President, has also benefitted from robust revenues, which added some $14 billion to Tesla's valuation.
However, Musk's firm is also benefiting from hype and may be overvalued. Its market capitalization topped that of Toyota, which produces 25 times more cars. Is Tesla in bubble territory? Those seeking EV investment may prefer NIO, especially after its successful results, as well as other companies.
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