Macquarie Reiterates Neutral Rating on NIO (NIO)

Macquarie analyst Eugene Hsiao reiterated a Neutral rating and $4.70 price target on NIO (NYSE: NIO)

The analyst comments "Why it matters • We have previously noted the high likelihood that the company would require a further equity raise given the rapidly declining cash balance. • Prior to the proposed transaction we estimated ~2.5 years of cash reserves. Cash and equivalents declined to Rmb41.9bn at the end of 2024 from Rmb57.3bn a year ago. • Current liabilities in FY24 amounted to Rmb62.3bn, which is higher than the current assets of Rmb61.8bn. • The company appears to be opportunistic in raising capital following recent H-share equity placements from other EV makers like BYD and Xiaomi. What now • While this latest cash injection helps NIO to tide over its finances in the near-term, we remain concerned over the need for further external financing in the future and expect FCF to remain negative in FY25E. • For China auto investors, the question is now less about NIO, but who is the next Chinese EV player to come to market given the relative short window between Q4 and Q1 results quiet period. With BYD, Xiaomi and now NIO with fresh equity placements, it remains a key question if other H-share listed EV companies will opportunistically look to follow."

For an analyst ratings summary and ratings history on NIO click here. For more ratings news on NIO click here.

Shares of NIO closed at $4.22 yesterday.

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