The Weekly Buzzing Stocks by Billy KawasakiNIO LimitedNIOTOP PICKDec 01, 2022
NIO Inc. is a pioneer in China's premium smart electric vehicle market. Founded in November 2014, NIO's mission is to shape a joyful lifestyle. NIO aims to build a community starting with smart electric vehicles to share joy and grow together with users. NIO designs, jointly manufactures, and sells smart premium electric vehicles, driving innovations in next-generation technologies in connectivity, autonomous driving, and artificial intelligence. Redefining the user experience, NIO provides users with comprehensive and convenient power solutions, the Battery as a Service (BaaS), NIO Pilot and NIO Autonomous Driving (NAD), Autonomous Driving as a Service (ADaaS) and other user-centric services. Social media mentions are up 267% in the past 24h.
He's cautious on Chinese stocks in general, underperforming. Structural issues over there. Bit of a bounce, in line with the shift to risk-on. Take profits. At risk. Chart doesn't look great, potential for retracement.
Does not like Chinese investments that don't earn cash.
Insecure political environment.
Negative return on capital (no sustainable).
Is a speculative stock.
EVs will be a significant force moving forward. Question is which one will lead? Stay on the sidelines. The valuations of Ford, HMC and FUJHY look more compelling than any of the EV companies. Sell, don't buy.
Any fear of delisting? China probably the largest EV market in the world. Makes a lower-cost EV model. Risk with China has increased, given Taiwan situation. Problems with Chinese regulators. He plays where rule of law is more transparent.
Would not buy any Chinese company listed on US stock market.
High risk with de-listing and political issues.
Rising interest in EV market will be good for market overall.
Better names to gain exposure to EV market.
E-car sales are good in China, better than here. A high-grow company but lacks profit and cash flow, so the market struggles to put a value on this. He's also concerned about the long-term Chinese economy. China is no longer in the build build build phase, but is building its middle class. Too speculative for him.
The whole EV space will grow, and there are a number of ways to play it. The issue is whether the US companies are going to be the dominant story. The Europeans and Japanese will get in on the story. He wouldn't chase here, especially with rising rates.
Chinese EV manufacturer. Great products, but lose money. Keeps pushing out profitability. Reminds him of RIVN. After the fanfare, it's tough to invest in the cold light of dawn when they're burning cash. Speculative.
Offers good value in the EV space, relative to Tesla. You are paying insane earnings expectations for Tesla. NIO is one of the best plays right now. Got an upgrade today. Chinese ADR risk is starting to lift, so there will be more interest coming in.
Long trade relative to Tesla. One of his biggest positions now. It has great long term potential and has been beaten down quite a lot. Valuation is very good.
Rules were relaxed for Chinese firms to list on the NYSE. Now the rules are changing, and China is reluctant to comply, since personal data and technology are accessible. Hard to compete with TSLA, as it's a beautifully designed computer on the road, and the company has already collected lots of driver data. The valuation is another matter, but TSLA is the one you want to own.