Shares of Chinese electric-vehicle maker NIO (NYSE:NIO) were trading lower on Wednesday, as investors took profits after a huge run-up in the stock's price over the last month.
As of 2 p.m. EDT, NIO's shares were down about 5.2% from Tuesday's closing price -- but still up over 70% since the beginning of July.
There was no big news (or even not-so-big news) driving NIO's shares lower on Wednesday. My sense is that this is just a pullback after a big run -- no surprise given the gains that NIO investors have seen over the last few weeks.
NIO's share-price surge began in earnest after it reported its second-quarter sales results early in July. The company said that its vehicle sales in the quarter had nearly tripled from the year-ago period (up 191% to 10,331, to be precise), as the coronavirus pandemic receded and NIO was able to take advantage of the expanded sales infrastructure it put in place last year.
NIO has come a long way from where it was in February, with sales reeling amid the pandemic and auto investors growing concerned about its dwindling cash reserves. But now, following cash injections from early investor Tencent Holdings and economic-development authorities in China's industrial heartland, NIO has rising sales, money in the bank -- and investors growing excited.
Given the strong sales result, investors will be eager to hear from CEO William Bin Li and his team when the company reports its second-quarter earnings result. Expect that to happen sometime in the middle of next month.