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Why NIO Stock Is Higher Today

By John Rosevear - Feb 24, 2021 at 1:24PM

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Despite yesterday's sell-off, NIO investors are still looking forward to next Monday.

What happened

Shares of Chinese electric-vehicle maker NIO (NIO 2.79%) were moving higher on Wednesday, as buyers looking ahead to the company's earnings report next week moved in after Tuesday's sectorwide sell-off. 

As of 1:15 p.m. EST, NIO's American depositary shares were up about 4.7% from Tuesday's closing price. 

So what

NIO's stock was one of many electric-vehicle stocks rebounding to varying degrees on Wednesday. The group sold off sharply early on Tuesday, as investor concerns about rising U.S. interest rates hit more speculative stocks hard. Electric-vehicle stocks faced extra pressure following a sharp decline in shares of category leader Tesla (TSLA -3.50%). 

Nothing about NIO's fundamentals or story changed, of course. All of these things are still true:

and last, but certainly not least:

  • NIO's stock is still trading at a very high valuation. 
Li is on stage with a sleek white electric sedan.

CEO William Bin Li showed off NIO's upcoming ET7 luxury sedan at an event in January. The new sedan -- and a smaller sibling -- are expected in roughly a year. Image source: NIO.

Simply put, if you were bullish on NIO a week ago, there's no reason not to be bullish now. I think that realization is why the stock is bouncing today.

Now what

Auto investors can look forward to an update next Monday, when NIO reports fourth-quarter and full-year 2020 earnings. I expect it'll provide some guidance for 2021 as well. Note that NIO's earnings report will be released shortly after the U.S. markets close, but -- because of the time difference between the U.S. and China -- the conference call won't happen until 8 p.m EST, or 9 a.m. Beijing time. 

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Stocks Mentioned

Nio Inc. Stock Quote
Nio Inc.
NIO
$14.71 (2.79%) $0.40
Tesla, Inc. Stock Quote
Tesla, Inc.
TSLA
$742.62 (-3.50%) $-26.97

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