Nio's Stock Struggles Amid Delivery Slowdown and Losses

Nio's stock has plummeted to around $4, a serious decline from its peak. Investors worry over its slowing deliveries and declining margins. While 2024 shows a potential rebound, concerns over losses and debt remain, leaving investors to ponder if this is a buying opportunity.

Date: 09-05-2025

AI Rating: 5

Nio's Current Market Position
Nio, once a darling in the EV market, is now facing significant challenges as its stock price dwindles. Trading substantially lower than its IPO price, concerns over delivery slowdowns and declining vehicle margins plague investor sentiment.

The report indicates that Nio experienced remarkable growth with deliveries more than doubling in previous years but has since faced a slowdown. Deliveries have only increased by 31% in 2023 due to various external factors, including enhanced competition and economic factors in China. However, 2024 has shown promising signs of recovery, with an increase in deliveries reaching 39%.

Net Loss and Revenue Expectations
For the full year, analysts predict a revenue growth of 39% to 91.1 billion yuan, while the net loss is expected to narrow to 16.4 billion yuan. This contrast paints a picture of a company striving to increase income while managing losses. With an enterprise value of about $10.6 billion, Nio currently trades at less than one times this year's sales, indicating possible undervaluation compared to competitors like Tesla, which trades at nearly nine times sales.

Profit Margins
Nio has seen its vehicle margins drop from 20.2% in 2021 to 9.5% in 2023. However, an improvement to 12.3% is forecasted for 2024, driven by increased sales of higher-margin premium vehicles. Such fluctuations in margin could significantly impact investor confidence.

Investor Considerations
With high debt-to-equity ratios and persistent losses, Nio faces substantial risks that could deter potential investors from flocking back to its stock. Still, some analysts argue that any recovery in consumer interest or favorable trade deals could facilitate a rebound, making Nio an intriguing option for long-term investors who expect it to outlast its competitors.

Stocks: NIO TSLA