What happened

Shares of NIO (NYSE:NIO) rose 65.2% in November, according to data from S&P Global Market Intelligence. The Chinese electric vehicle (EV) stock posted explosive gains thanks to rumors of a quick entry into a new geographic market, a strong quarterly report, and momentum for the broader market. 

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InsideEV published a report on Nov. 3 stating that NIO is on track to enter the European market in 2021. NIO then published third-quarter earnings near the middle of the month, delivering results for the period that topped the market's expectations. Guidance for Q4 also came in ahead of Wall Street's targets.


Image source: NIO.

So what

InsideEV's report early in November claimed that NIO has already laid the foundations to launch its business in Europe and is on track to begin selling vehicles in the territory in the second half of next year.  The automotive stock got a significant boost following the media outlet's report and continued to climb in the lead up to the company's third-quarter report. 

NIO published Q3 results on Nov. 17, delivering results that topped the market's expectations. The company posted a non-GAAP (adjusted) loss per share of $0.12 on revenue of $666.6 million, while the average analyst estimate had targeted a per-share loss of $0.15 on sales of $628 million. The company also delivered 12,206 vehicles in the quarter. The stock dipped shortly after the earnings release due to a sell-off for the broader market, but it quickly rebounded and set a new lifetime high. 

Now what

NIO stock has dipped in December. The company's share price has dipped roughly 5% so far despite an impressive vehicle shipment update early in the month. 

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^SPX data by YCharts

NIO delivered 5,291 vehicles in November, up 109.3% year over year. The company has delivered 36,721 vehicles through the first 11 months of the year. Total deliveries for the company's ES8, ES6, and EC6 had reached 68,634 as of Nov. 30. Even with the impressive delivery update, the company's share price has dipped as market enthusiasm for foreign EV stocks has waned. 

NIO is guiding for fourth-quarter sales to come in between $921.8 million and $947.9 million. It's also guiding to deliver between 16,500 and 17,000 vehicles -- up roughly 103% year over year at the midpoint of the target. 

NIO is valued at roughly $58.6 billion and is trading at approximately 24 times this year's expected sales.

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