Bernstein analyst Eunice Lee lowered the price target on Nio to $4.00 from $4.50 while maintaining a ‘Market Perform’ rating, following what she described as “another weak quarter” for the Shanghai-based electric vehicle maker.
In a research note published this week, Lee said Nio’s first-quarter results were “another miss,” with revenue falling 38.9% sequentially to RMB 12.0 billion, despite a year-on-year increase of 21.5%.
Vehicle deliveries totaled 42,094 units, up 40.1% from a year earlier but down sharply from the prior quarter’s 72,000.
The average selling price declined 15.3% year-on-year to RMB 236,100, which Lee attributed to the ramp-up of Nio’s lower-priced Onvo L60 model — accounting for 35% of Q1 volumes — and continued inventory-clearing promotions.
Bernstein analyst said Nio’s gross margin of 7.6% “was disappointing,” adding that vehicle margin “deteriorated to 10.2%” between January and March when compared to the 13.1% on the final quarter of last year due to “operating deleverage from lower production volumes.”
Total operational expenses stood at 7.3 billion yuan, with Eunice Lee noting that it represented “61.0% of revenue.”
The company posted a net loss of 6.8 billion yuan for the quarter, widening its net margin to -56.1%.
“We rate Nio at ‘Market Perform’ with price targets lowered to $4.00 for Nio’s U.S.-listed shares (from $4.50) and HK$31.00 for its Hong Kong listing (from HK$35.00), reflecting reduced revenue estimates and a lower EV/sales multiple of 0.5x (previously 0.7x),” Lee said.
Bernstein joins a growing list of Wall Street firms that have trimmed their targets on Nio in the wake of its Q1 earnings report.
Earlier this week, Macquarie cut its target to $3.90 from $4.70, warning of intensifying BEV competition and ongoing concerns over “unabated cash burn.”
Mizuho Securities followed with a downgrade to $3.50 from $4.00, citing execution risks and pressure from an increasingly crowded Chinese EV market.
In contrast, Morgan Stanley reiterated its ‘Overweight’ rating on the stock, maintaining a $5.90 target — representing a 72% upside from current levels.
Analyst Tim Hsiao said “all eyes remain on Nio’s volume resurgence and cash flow,” as the company aims for monthly deliveries of 50,000 units by the fourth quarter through new model launches under both the Nio and Onvo brands.
Onvo will launch the L90 and the L80 in the second half of the year, while Nio will debut the new ES8 while ramping up production of the other recently refreshed models ET5, ET5 Touring, ES6 and EC6.
As of the time of writing, Nio shares are trading 4.1% lower at $3.60. Year to date, the stock is down nearly 18%.
