US-listed shares of the EV maker Nio erased last week’s losses tied to its $1 billion equity raise, climbing 3.7% to $6.45 in Monday’s premarket trading.
The rebound comes just days ahead of the company’s annual event on September 20, where it will officially launch its three-row ES8 SUV.
The stock had fallen as much as 10% last Wednesday after the company announced the fundraising, touching $5.72 by the close.
That compared with $6.27 immediately before the offering was disclosed.
Nio shares then rebounded, ending Thursday up 6% at $6.07 and extending gains to $6.22 on Friday.
The recovery came as Goldman Sachs and JPMorgan issued notes on the offering.
JPMorgan reiterated an Overweightrating with an $8 price target, saying the raise was “not a surprise” in the context of industrywide capital needs, though the timing so soon after Nio’s second-quarter results was unexpected.
Goldman Sachs, meanwhile, kept a Neutral rating and cut its target on the US shares to $4.10, while setting HK$31.8 for the Hong Kong listing.
Goldman expects the new capital to reduce Nio’s debt ratio to 92% from 98% and forecasts R&D spending to reach 11 billion yuan ($1.4 billion) in both 2025 and 2026.
The bank projects Nio will deliver 89,000 vehicles in the third quarter and 131,000 in the fourth — short of CEO William Li’s target of 150,000 for the year-end quarter.
Nio delivered 42,094 vehicles in the first quarter and 72,056 in the second.
For Q3, the company has guided for 87,000 to 91,000 deliveries, which would set up a sequential jump of 65% to 72% in Q4 if Li’s goal is met.
Investors believe that demand for the new ES8 SUV and ramping production of the Onvo L90 as drivers of growth.
Additionally, the shift announced earlier this year to a distributor model in overseas markets was designed to cut fixed costs and accelerate Nio’s expansion in Europe, Asia and Australia-New Zealand.
