Shares of Chinese electric-vehicle maker NIO (NYSE:NIO) were modestly higher on Tuesday. A Wall Street analyst shared bullish comments on the company after it said that it had closed a $1.5 billion convertible-bond offering.
As of 2 p.m. EST, NIO's American depositary shares were up about 3% from Friday's closing price.
There were two pieces of interesting news for NIO investors on Tuesday morning.
First, the company said that its offering of $1.5 billion in convertible notes has closed. The notes are in two series, each with principal value of $750 million: one matures in 2026 and pays no interest; the other pays 0.50% per year and will mature in 2027. Notes in both series can be converted to NIO American depositary shares at a price of $93.06.
That's a good deal for NIO, and it confirms that interest in the company remains extremely high among institutional investors.
Separately, NIO said that about $582 million of its previously issued 4.5% notes, originally due in 2024, have now been converted to stock.
Second, Jefferies analyst Alexious Lee initiated coverage of NIO with a hold rating and a price target of $60. Lee said that NIO is "China's icon for luxury BEVs" and auto investors' expectations are high following its successful NIO Day event earlier this month; but he sees revenue for 2021 and 2022 coming in about 10% behind Wall Street consensus as he believes electric-vehicle adoption will progress more slowly than expected.
Investors can look forward to hearing more about the company's expectations for 2021 from CEO William Bin Li during the company's fourth-quarter and full-year 2020 earnings report, likely in mid-February.