NIO Stock Gains Buy Ratings Post Q3 Earnings as Analysts Highlight Path to Profitability
NIO Inc. (NIO) is drawing bullish sentiment from Wall Street following its third-quarter earnings report. Analysts cite improving margins, disciplined cost controls, and a strengthened product pipeline as catalysts for the Chinese EV maker's trajectory toward profitability.
Morgan Stanley's Tim Hsiao maintains a Buy rating with a $9 price target, emphasizing NIO's planned 2026 launch of three large SUVs—ES9, ES7, and Onvo L80—as volume drivers. The firm projects a 20% gross margin target achievable through supply chain efficiencies, economies of scale, and optimized product mix.
With current models like ES6 and ES8 already exceeding 20% margins, NIO appears positioned to sustain profitability despite competitive pricing. Cost containment in R&D (capped at RMB 2B quarterly) and SG&A (targeted at 10% of revenue) could deliver breakeven by 2026 on an adjusted basis.
