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<p class="has-drop-cap">This year has been challenging for the broader <a href="https://tokenist.com/three-asian-ev-stocks-that-can-compete-with-tesla/" rel="noopener noreferrer nofollow" class="deco-link">electric vehicle (EV) market</a>, with the Chinese automaker Nio (NYSE: NIO) grappling with especially intense pressure. The company’s stock fell more than 5% on Tuesday, hitting a 52-week low.</p>
<h3 id="nio-shares-hovering-above-3-5-year-support">Nio Shares Hovering Above 3.5-Year Support</h3>
<p>Nio stock fell 5.7% on Tuesday to $5.79, a fresh 52-week low.</p>
<p>The downswing represents the latest blow for the EV maker, which has been on an overall downtrend since the start of 2024. Year-to-date, the stock plummeted more than 31%, making it one of the worst-performing EV stocks.</p>
<p>Overall, the broader market has been trading in the red this year, with the <a href="https://tokenist.com/tesla-is-the-only-loser-in-the-magnificent-seven-so-far-this-year/" rel="noopener noreferrer nofollow" class="deco-link">industry leader Tesla</a> (NASDAQ: TSLA), BYD, and Li Auto (NASDAQ: LI) all seeing double-digit losses since January 1.</p>
<p>At the current share price, Nio is trading well below its 100-day and 200-day moving averages (MA), which are located at $7.98 and $8.95, respectively.</p>
<p>On the downside, the stock is hovering above $5.5, a level not touched since June 2020. On the upside, Nio faces a resistance zone between $6.9 and $7. Clearing this barrier would allow the bulls to attack the resistance at the 200-day MA.</p>
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<h3 id="what-s-next-for-nio">What’s Next for Nio?</h3>
<p>Nio’s recent downturn was quick and painful, yet its path to recovery appears considerably more challenging. A significant factor is the EV maker’s difficult <a aria-label="journey toward profitability (opens in a new tab)" href="https://investorplace.com/2024/01/uh-oh-why-nio-stock-looks-like-a-no-go-for-2024-and-beyond/" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">journey toward profitability</a>, among other things.</p>
<p>In the 12 months leading up to September 30, Nio reported a significant loss of 21.4 billion Chinese yuan ($3.02 billion) against revenue of 54.6 billion Chinese yuan ($7.70 billion), translating to 39 cents lost for every dollar earned.</p>
<p>The company’s vehicle margin declined to 11% in Q3 2023, down from a peak of 20.1%, while Tesla’s automotive gross margin also dropped to 18.7% from 27.9% in the same quarter the previous year.</p>
<p>This contrasted with Tesla’s $1.76 billion operating profit in <a href="https://tokenist.com/bernstein-keeps-tesla-pt-at-150-says-its-looking-like-a-regular-auto-company/" rel="noopener noreferrer nofollow" class="deco-link">Q3 2023</a> and Nio’s $664 million operating loss. To break even in Q3 2023, Nio would have needed 6 billion yuan in vehicle sales, more than double its sales for the quarter.</p>
<p>Still, it’s not all doom and gloom. The carmaker ended 2023 on a high note, <a aria-label="delivering (opens in a new tab)" href="https://ir.nio.com/news-releases/news-release-details/nio-inc-provides-december-fourth-quarter-and-full-year-2023#:~:text=NIO%20delivered%2050%2C045%20vehicles%20in%20the%20fourth%20quarter%20of%202023,as%20of%20December%2031%2C%202023." target="_blank" rel="noopener noreferrer nofollow" class="deco-link">delivering</a> 18,012 in December, up around 13% from a month prior. During Q4, Nio delivered 50,045 units, just below its quarterly high of 55,432.</p>
<p>Looking ahead, the company is broadening its manufacturing scope by introducing sub-brands, targeting the more affordable vehicle segments. Nio estimates it holds a significant share of over 40% in the ultra-premium market.</p> <iframe src="https://tokenist.substack.com/embed" width="100%" height="320" style="border:1px solid #EEE; background:white;" frameborder="0" scrolling="no"></iframe>
<p><em><strong>There is both a bull and bear case for Nio. Which do you think will prevail in 2024? Let us know in the comments below.</strong></em></p>
<p><em>Disclaimer: The author does not hold or have a position in any securities discussed in the article.</em></p>
<p>The post <a rel="noopener noreferrer nofollow" href="https://tokenist.com/nio-stock-is-at-a-52-week-low-can-it-bounce-back/">Nio Stock is at a 52-Week Low, Can it Bounce Back?</a> appeared first on <a rel="noopener noreferrer nofollow" href="https://tokenist.com">Tokenist</a>.</p>

Nio Stock is at a 52-Week Low, Can it Bounce Back?

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