Could Buying Nio Stock Today Set You Up for Life?

Core Viewpoint - Nio's stock appears undervalued, trading below its IPO price, but faces challenges in delivering consistent growth and profitability [1][2][11]. Delivery Performance - Nio's annual deliveries surged nearly 11-fold from 2019 to 2024, but growth decelerated significantly in 2022 and 2023 due to supply chain constraints, competition, and economic slowdown [3][4]. - Deliveries: 20,565 in 2019, 43,728 in 2020, 91,429 in 2021, 122,486 in 2022, 160,038 in 2023, and projected 221,970 in 2024 [4]. Financial Metrics - Nio's vehicle margin decreased from a record high of 20.2% in 2021 to 9.5% in 2023, while annual net loss more than quadrupled from 2021 to 2023 [4][9]. - Revenue is expected to grow at a compound annual growth rate (CAGR) of 30% from 2023 to 2026, with a projected revenue of 97.6 billion yuan ($13.5 billion) for 2025 [9][10]. Market Position and Strategy - Nio differentiates itself with swappable batteries and has launched new models like the Onvo L60 and Firefly to capture market share [2][6][8]. - The company is expanding in Europe despite facing higher tariffs on Chinese-made EVs [6][8]. Margin Recovery - Quarterly vehicle margins improved in 2024, increasing from 9.2$10.9 billion), trading at less than 1 times its projected sales for 2025, compared to Tesla's 6 times [10]. - Persistent U.S.-China tensions and market cooling are affecting Nio's valuations, but easing pressures could lead to a revaluation as a growth stock [11][12].