Shares of Chinese electric-vehicle maker NIO (NYSE:NIO) closed higher again on Thursday, after a Chinese business media outlet reported that the company may be close to a securing a hefty line of credit.
NIO's American depositary shares ended Thursday's session at $14.63, up 13.6% from Wednesday's closing price. The shares have risen about 88% since the beginning of July.
NIO's shares are still running on the momentum of last week's upbeat sales report. After a dismal first quarter amid China's coronavirus shutdown, NIO recovered -- and then some -- in the second: Sales were up over 190%, as last year's investments in an expanded store network began to pay off for the company.
That, plus the recent financing deals that have bolstered NIO's once-shaky balance sheet, would be enough to set off a bullish stampede for the stock.
But there might be more news soon, and that may have given NIO's shares an additional push on Thursday. 36kr, a Chinese technology and business news outlet, reported that NIO will soon sign a deal with six banks to secure a new 10 billion Chinese yuan ($1.42 billion) line of credit.
While NIO wouldn't confirm the report, such a deal would give the company added access to working capital as it gears up to put additional models into production. If it happens, it's clearly bullish.
I suspect we'll know soon if that credit line report is for real. If not, auto investors will have to wait a bit longer for an update from NIO's management. The company hasn't yet scheduled its second-quarter earnings report, but it's likely to happen sometime next month.