With a price of nearly 55$ per share and a market cap reaching 100 billion dollars, NIO has undoubtedly become a massively overvalued company that can be the cause for a destructive financial crisis when the optimistic enthusiasm for the EV Sector ends.
The only way to profit from a Stock is -apart from the growth- its Earnings and the resulting dividends. Selling only 40000 cars per year NIO currently has a negative EPS of -0.94$, which makes it noxiously overvalued (for comparison: General Motors sells around 6.38 million) ). This is often justified with future Growth, but NIO will still be overvalued even if it beats Analysts Estimates. This might cause the bubble to burst, especially when Tech Companies like Apple or Xiaomi start producing their own cars in the future.
You could buy the stock for short term swings, but I do not recommend it for the long term.
Warning: If the bubble bursts, it will happen fast. Do not buy the stock unless you are completely sure what you are doing.
The only way to profit from a Stock is -apart from the growth- its Earnings and the resulting dividends. Selling only 40000 cars per year NIO currently has a negative EPS of -0.94$, which makes it noxiously overvalued (for comparison: General Motors sells around 6.38 million) ). This is often justified with future Growth, but NIO will still be overvalued even if it beats Analysts Estimates. This might cause the bubble to burst, especially when Tech Companies like Apple or Xiaomi start producing their own cars in the future.
You could buy the stock for short term swings, but I do not recommend it for the long term.
Warning: If the bubble bursts, it will happen fast. Do not buy the stock unless you are completely sure what you are doing.