NIO share price: what’s the latest after favourable Q3 earnings?
The electric carmaker delivered a strong Q3 earnings after several disappointing quarters, but the stock remains under pressure with investors fearing the company could collapse without a cash injection.
NIO delivered a decent set of third-quarter (Q3) earnings in October, with vehicle deliveries up 35% from the previous quarter to 4799, finally sending the stock a touch higher.
However, since the start of the year, NIO has seen its share price fall by more than 75%, from $6.20 a share in January to trade at $1.50 as of 15:25 GMT on Friday.
Looking to trade NIO? Open a live or demo account with IG.
Is NIO on the brink of collapse?
Investors are concerned about the strength of the electric carmaker’s balance sheet, with the company receiving a ¥10 billion ($1.45 billion) cash injection from the Chinese government back in May.
However, even a government bailout may not be enough, with the company likely to need a further injection of cash in order to avoid collapse.
You can go long or short NIO with IG using derivatives like CFDs.
NIO struggles with financing
The Chinese government was forced to step in and offer emergency financing to NIO after the electric carmaker continues to burn through cash at a rapid rate.
In its Q3 results, the company admitted that it had spent $620 million in its second quarter, leaving it with $503.4 million in cash as of June 30.
NIO has also struggled to secure financing from investors, with Tencent meant to assist with the sale of a $200 million convertible notes offering, though it has not been completed and, even it does, it won’t do much with the carmaker haemorrhaging money at its current pace.
This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only
