The Nio (NYSE: NIO) stock price jumped above $50 for the first time since March after Citi analysts upgraded the company. The stock is trading at $50.35, which is about 65% above the lowest level in May. This brings its total market capitalisation to more than $80 billion.
Nio upgraded by Citi analysts
There are several reasons why the Nio stock price has surged recently. First, the company is set to expand its market share globally. Recently, it became the first Chinese electric vehicle company to acquire a license to operate in the European Union (EU).
Second, investors love Nio for its growing market share in China, where it is the most visible alternative to Tesla. The firm delivered more than 7,100 cars in April this year, a 125% year-on-year gain. It then delivered 6,711 cars in May and is on track to deliver between 21,000 and 22,000 this quarter. The firm blamed the ongoing chip shortage for its weak growth in May.
Third, the Nio stock price has jumped because of the relatively bullish statements from analysts. On Tuesday, analysts at Citi boosted their price target to $72 from $58. The analysts upgraded the stock about three weeks ago. The most optimistic analysts are from Morgan Stanley who expects the shares to jump to $80. The other bullish analysts are from Mizuho, HSBC, and Deutsche Bank. In a note, Barrons said:
“A combination of hope regarding deliveries, broader moves in the stock market, and optimism over NIO’s competitive position, could be behind the move.”
Further, the Nio stock price has jumped because of the broad performance of the EV market. Tesla shares have risen by more than 25% from their lowest level in May while
