Following recent price target increases from Mizuho, Tiger Securities and Macquarie, Bank of America on Wednesday became the latest brokerage to raise its outlook on Nio, citing improving sales momentum and a strong product pipeline.
BofA Securities analyst Ming Hsun Lee lifted the price target on the EV maker to $7.10 from $5.00 while maintaining a Neutral rating.
In a new research note, Lee said the firm now expects Nio’s sales volumes in 2025, 2026 and 2027 to be 9%, 19% and 21% higher than previous forecasts.
The Shanghai-headquartered group aims to double sales in 2025 to about 440,000 units.
After delivering a record of over 31,300 units in August across the three brands, Nio’s management is targeting 150,000 vehicles delivered in the final quarter alone while guiding for between 87,000 and 91,000 in the current quarter.
Gross margin estimates were also raised by 0.5, 0.7 and 0.7 percentage points, respectively, reflecting anticipated economies of scale.
“Net-net, we expect 2025/26E non-GAAP net loss to narrow by 7%/50% versus our previous estimates, and forecast 2027E adjusted profit (non-GAAP) to turn positive,” Lee wrote. The analyst added that the non-GAAP net loss in the second quarter came in “better” than the firm’s estimates at 4.1 billion yuan.
BofA said the recently launched three-row SUVs, the Onvo L90 and the third-generation Nio ES8, “look competitive, in terms of space, and performance-to-cost ratio.”
Onvo delivered more than 10,000 units of the L90 in August, while the ES8 recorded strong orders, which Lee said is “likely signaling the company is starting a strong model cycle.”
The firm raised its valuation to $7.10, or HK$55 per Hong Kong share, from $5.00 (HK$39), driven by a higher weighted average cost of capital of 13.4% compared with 12.5% previously.
“We reiterate Neutral, as despite the strong model pipeline, in our view the positives from volume growth and a narrowing loss are already reflected in the current valuation,” Lee said.
Other analysts also raised their targets on Wednesday.
Online broker Tiger Securities and Australian investment bank Macquarie lifted their price targets on Nio after the company posted second-quarter results under founder and CEO William Li.
Macquarie analyst Eugene Hsiao raised the Hong Kong-listed shares to HK$53.00 from HK$44.00 while maintaining an Outperform rating.
Earlier in the day, Mizuho analyst Vijay Rakesh upgraded Nio’s rating and price target, noting that while second-quarter revenue and EPS were “modestly softer,” the company’s outlook for the second half of the year remains strong.
