NIO Stock Jumps: One Analyst Looks at What Comes Next

NIO NIO +3.92% ▲ closed out the year with a quarter that may change how investors view the Chinese EV maker. After years in which rapid expansion often came with heavy losses, the company’s latest results suggest its strategy may finally be beginning to bear fruit. The market’s reaction has been telling, with the stock rising ~21% since the earnings report.

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In Q4, the company reported strong top-line momentum, with total revenue rising 76% year-over-year and 59% quarter-over-quarter to about RMB87.5 billion, driven by higher deliveries and a more favorable mix of newer models. Vehicle sales increased 65% sequentially and were 81% higher than the same period last year.

Vehicle gross profit margin also strengthened, improving 5.0 percentage points y/y and 3.4 percentage points QoQ. Together with disciplined operating expense management, this allowed Nio to post positive operating profit and net income for the first time in its history. Looking ahead to 1Q26, the company expects shipment growth to nearly double vs. the year-ago period, while keeping vehicle gross profit margin at roughly the same level as in 4Q25.

All of that, says Nomura analyst Joel Ying, indicates a “good start” to 2026. “Considering NIO’s efforts around operational optimization during mid-2025, we are positive on the company as its new models are welcomed by the market and it continues to efficiently control expenditure,” the analyst said.

Looking ahead to the rest of the year, with the ES9 and Onvo L80 expected to launch in 2Q26 and the new ES7 in 3Q26, alongside the existing Onvo L90 and the new ES8 – bringing the lineup to five mid- and large-size SUVs – Ying believes the company is well positioned to capture market share gains while further improving its margins and overall financial performance.

“Observing the company enter into an active business cycle, we have an optimistic outlook for its future development,” the analyst further added.

To account for the challenging market backdrop and Nio’s product rollout schedule, Ying has reduced his FY26–27F shipment forecasts. That said, he continues to expect shipments will grow at a 25% CAGR over FY25–28F. As such, Ying expects revenue to increase at a 21% CAGR over the same period.

At the same time, Ying has raised his FY26F and FY27F gross profit margin forecasts by 0.7 percentage points and 1.1 percentage points, respectively, and lifted his operating profit margin estimates by 3.3 percentage points and 3.2 percentage points. Ying now expects Nio to reach non-GAAP operating profit breakeven in FY26 and still anticipates NIO will reach bottom-line breakeven in FY27. “Considering its current valuation and encouraging outlook, we believe its valuation looks attractive,” the analyst summed up.

As such, Ying has upgraded his NIO rating from Neutral to Buy, while his $6.6 price target suggests the stock will gain 8% in the months ahead. (To watch Ying’s track record, click here)

Ying now joins 6 other analysts in the NIO bull camp, while an additional 2 Holds all add up to a Moderate Buy consensus rating. The average price target clocks in at $6.46, suggesting shares will appreciate by 5.5% over the next year. (See Nio stock forecast)

Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

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