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Anticipating NIO Q2 Earnings: What to Look Out For

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Chinese Electric Car Maker NIO Inc. Opens Trading On NYSE On Day Of Company

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  • The Chinese automaker NIO (NYSE:NIO) is set to release its Q2 earnings results on Tuesday, August 29th, prior to market open.
  • Analysts estimate an EPS of -$0.41 and revenue of $1.27 billion.
  • In the past two years, NIO has surpassed EPS estimates in 50% of cases and revenue estimates in 75% of cases.
  • Over the last three months, there have been no upward revisions in EPS estimates and four downward revisions in revenue estimates.
  • In the previous quarter, NIO reported a Q1 Non-GAAP EPADS of -$0.36, exceeding estimates by 5 cents. However, revenue of $1.55 billion fell $80 million short of expectations.
  • NIO has a Quant rating of β€œHOLD” with a score of 3.04.
  • According to SA’s Quant ranking, NIO holds the 23rd position out of 31 automobile manufacturer stocks.
  • Wall Street rates NIO stock as a β€œBUY,” while Seeking Alpha authors rate it as a β€œHOLD.”
  • In 2022, NIO stock experienced a significant decline of 70.9%, whereas the benchmark S&P 500 Index dropped nearly 20%.
  • So far this year, NIO stock has risen by 12.5% as of the close of trading on Friday.

Recent Analysis on NIO

β€œWe are downgrading NIO to a sell. We anticipate the company will face challenges in the Chinese macro environment and fierce competition in terms of pricing. Despite new releases, expectations for gross margin percentage growth in Q2 2023 remain low due to price cuts and increased production output. We don’t foresee the stock outperforming in the near-term due to competition and weaker-than-expected demand. Based on these factors, we recommend investors exit the stock at its current levels and consider other better-positioned names for outperforming in the second half of 2023,” writes Tech Stock Pros in an August 23 research report.

β€œAlthough NIO saw a rise in deliveries in July and achieved a record number of deliveries, it is still far from reaching its target of 250,000 deliveries for 2023. Additionally, I predict that the EV maker will fall short of analyst revenue estimates in its Q2 earnings report. The company operates with very low gross margins and is burning through cash at an extremely high rate. While the investment it received from the Abu Dhabi government will help sustain operations, I believe it is insufficient, and NIO will need more investment capital if it continues to burn through cash at the current rate. These factors have led me to assign NIO a sell rating,” writes SA contributor Penny Stocks Today in an August 10 report.

Source: Benzinga.com

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