Investors can expect some fireworks when Chinese electric vehicle maker
reports second-quarter numbers after the close of trading Wednesday. NIO is expected to report strong sales and guidance, but that might not be enough for the stock to rise.
Over the past eight quarters reported, NIO (ticker: NIO) stock has moved an average of 15.6%, up or down, following earnings. The stock has dropped the day following six of those eight quarters.
And half of those six drops followed bottom line earnings that beat analyst expectations. What’s more, NIO reported better-than-expected sales in all six quarters.
Volatility expectations, however, are down a little for this quarter. Options markets imply a 7% to 10% move following this earnings report.
Wall Street is looking for an 8 cent per share loss from $1.28 billion in sales. In the first quarter NIO lost 4 cents a share from $1.23 billion in sales.
The quarterly estimates look achievable. NIO delivered about 22,700 vehicles in the second quarter, about 14% more than the 19,937 delivered in the first quarter of 2021.
Looking ahead, investors will want to hear about plans for more capacity. NIO is producing cars at a rate of about 8,000 a month. Investors will also want to hear about Chinese EV demand, which has been very strong so far in 2021.
A third topic on investors’ minds is the global automotive semiconductor shortage that has constrained auto production. The shortage remains, but is getting a little better in the second half of 2021. Investors will want to hear NIO management echo that sentiment.
NIO management hosts a conference call at 9 p.m. Eastern time tonight to discuss the results.
NIO stock has been on a wild ride in 2021. Shares are down about 9% year to date, trailing behind 18% and 15% comparable, respective gains of the
Dow Jones Industrial Average.
NIO shares are down 34% from their January 52-week high of almost $67 a share and are up 27% over the past three months.
Chinese government crackdowns on U.S.-listed Chinese companies, rising interest rates—which hurt richly valued, high growth companies more than others—and the chip shortage are responsible for much of the volatility.
Nio stock has dipped 0.1% at 3:49 p.m. Wednesday.
Write to Al Root at firstname.lastname@example.org