China-based electric vehicle maker Nio (NYSE:NIO) has staged an unbelievable turnaround during the past year. It feels like just yesterday some folks were crowing on social media about NIO stock possibly going to zero.
Source: Sundry Photography / Shutterstock.com
Today, you don’t hear too many people setting a zero price target on the stock. Just the stock’s price action alone has been enough to send many of the bears into hibernation.
Nio appears to be thriving nowadays, but the company’s story is still unfolding. Soon enough, we might start seeing Nio’s vehicles far beyond China’s borders.
We’ll certainly delve into the known details of Nio’s potential global expansion. First, however, let’s gather some intelligence on the technical aspects of the stock.
The NIO share price has just recent dipped to around $41. By the time you read this, though, the price could be quite different.
Nio released its fiscal fourth-quarter earnings data on March 1. Since that date, the value of the stock has dropped 14.79%.
But don’t be too concerned.
After all, this is a stock with a 52-week low of $2.11. The fact that the bulls pushed the share price up to $60 last month is quite a victory in itself.
The next target for the bulls should be to break past the 52-week high of $66.99 and stay above that level permanently. Beyond that, they should be eyeing $100 before the year is through.
In case I haven’t expressed this already, it’s truly mind-boggling to consider how far Nio has come.
With the bankruptcy buzz a distant memory (and really never true in the first place), Nio can now move on to bigger and better things.
In particular, it is now able to flex its geographic ambitions. But, is Nio truly ready and able to expand into a global presence?
William Li, the founder, chairman and CEO of Nio, just effectively put that question to rest. Reportedly, at a web conference, Li disclosed Nio’s plans to enter into the European market during 2021’s second half.
This would mark the very first time that that Nio will sell electric vehicles outside of China.
But wait, it gets even bigger and better. Evidently, after entering into the European market, Nio plans to begin selling its vehicles in other international markets in 2022.
Folks might wonder why Nio didn’t target the United States instead of Europe. Surely, the American market could be quite lucrative.
Yet, I would counter this by claiming that Europe is the next logical place for Nio to plant its flag.
In my defense, Li observed said that many of the automotive regulations in China and Europe are similar. He also pointed out that the European user and policy environment is comparatively friendly to electric vehicles.
Additionally, Li expressed that the signing of the China-Europe Investment Agreement allows Chinese companies a favorable environment in Europe.
Besides, an American invasion might still be the works. Intriguingly, Deutsche Bank analyst Edison Yu reportedly found a now-removed job posting on Microsoft’s (NASDAQ:MSFT) LinkedIn, looking for someone to “formulate an action plan to enter the US market.”
I don’t want to stoke the fire of the rumor mill, but that sounds like it might have been a not-so-stealthy signal from Nio.
Rumor mongering aside, there’s a strong bull case for Nio stock, as the long-term historical trajectory clearly slants upwards.
And regardless of what happens on earnings day, there’s no question that Nio’s ambitions are growing — and in time, the share price should grow too.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article.
David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.
The post Anticipated European Market Push Augments the Bull Case for Nio appeared first on InvestorPlace.
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