Shares of Nio Inc. NIO,
It plunged 6.8% in premarket trading on Friday after Goldman Sachs analyst Fei Fang turned bearish on the China-based electric vehicle maker, citing valuation concerns. It cut its rating to sell, after being neutral since early October. Its target share price is $ 7, which is 46% below Thursday’s closing price of $ 12.94. With the stock rising 89% over the past month, Fang wrote in a note to clients that he believes “the current stock price reflects over-optimism since there are no substantial changes in volume expectations / Profits”. In the long term, Fang said he believes Nio’s investment case depends on China’s option for structural auto premiumization and adoption of electric vehicles, combined with the shortage of being China’s first brand of high-end passenger vehicles. from China. The stock has more than tripled (up to 222%) year-to-date through Thursday, while US rival Tesla Inc. shares TSLA,
have almost tripled (up to 259%) and the S&P 500 SPX,
it has slipped 0.5%.
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