JPMorgan analyst Nick Lai reiterated an Overweight rating and $8 price target on Nio after the EV maker announced a $1 billion equity offering on Wednesday that sent its US-listed shares down 8.9% to $5.72.
Nio shares are still up 28.5% over the past month and 58% in the last three months. Year-to-date, the stock has gained 31.2% and is 8.3% higher over the past year, though it is down 6.7% in the past five sessions.
The Shanghai-headquartered firm said the funds will support research and development of EV technologies, expansion of its three-brand lineup, growth of its battery swapping and charging network, and balance sheet strengthening.
“We believe the fund raising itself may not be a surprise to the market as we have seen not only Nio but other EV players raising capital YTD [year to date],” Lai wrote in a note to clients on Thursday.
“Fund raising should help the company in an extremely competitive EV market in China,” the analyst noted before saying the timing to do it is “somewhat a surprise.”
Lai wrote that the “timing of the issuance is somewhat a surprise right after Nio’s recent 2Q25 result release when management highlighted its robust product pipeline and profitability turnaround in 4Q25.”
On September 2, the company reiterated the goal of achieving its first profitable quarter in the October-December period.
“All in all, our positive stance on Nio remains,” the analyst guaranteed.
JPMorgan had upgraded Nio to Overweight from Neutral on August 26 and placed the stock on its Positive Catalyst Watchlist, citing three key near-term drivers expected to support performance into year-end.
According to the company’s SEC filing, the offering involves up to 181.8 million Class A ordinary shares, split between American depositary shares in New York and ordinary shares in Hong Kong and Singapore.
Based on closing prices cited in the filing — $6.17 per ADS in New York, HK$47.18 ($6.01) in Hong Kong and $6.02 in Singapore on Sept. 8 — the deal would generate about $1.1 billion in gross proceeds.
If underwriters exercise their 30-day option to buy an additional 27.3 million ADSs, proceeds could rise to $1.26 billion–$1.29 billion depending on allocation.
The capital raise comes a week after management reaffirmed a fourth-quarter target of selling 50,000 vehicles a month across the Nio, Firefly and Onvo brands.
The company set a new record last month with deliveries of about 31,300 units.
As of press time, Nio’s US-listed shares were trading 1.7% higher at $5.82 during Thursday’s pre-market trading session.
