In case you didn’t get the memo, there’s an international trade war happening in 2024. That’s problematic for China-based electric vehicle manufacturer Nio (NYSE:NIO), no doubt. On the other hand, Nio stock has already been demolished as the ultraefficient market already absorbed the trade war news. Therefore, the stock’s next move is probably to the upside.
Despite international tensions, Nio’s recently reported vehicle delivery figures are quite encouraging. So, consider buying Nio shares at a discount while the worry warts are selling them.
Nio and Tariff Troubles
Through no fault of its own, Nio is caught in the crossfire of trade tensions between multiple nations. First, the Biden administration announced that it’s quadrupling the tariffs on China-made EVs imported into the U.S.
Then, the European Union revealed that it will “impose additional tariffs” of up to 38% on EVs imported from China into the EU, according to The New York Times. However, none of this should have been a complete surprise.
The Guardian explained that the EU’s tariffs follow “a nine-month investigation into alleged unfair state subsidies into Chinese battery electric vehicles (BEVs).” Undoubtedly, the highly efficient financial market already priced its fears about this into Nio stock.
It’s one reason you now have a chance to buy Nio shares under $5. And if you’re serious about buying on fear and selling on optimism, then the time to buy is right now as there’s no shortage of fear.
Nio Grows Its April and May EV Deliveries
Besides, it’s not as if Nio has stopped selling EVs. In actuality, the automaker’s vehicle delivery stats point to rapid acceleration.
Granted, Nio had a lackluster first quarter of 2024. As it turned out, the company’s EV deliveries declined 3.2% year over year to 30,053.
That’s old news by now, though. Just take a look at what’s happening so far in 2024’s second quarter.
This will absolutely blow your mind. In April, Nio’s vehicle deliveries exploded by 134.6% YOY to 15,620. Moreover, in the month of May, Nio’s EV deliveries ballooned 233.8% YOY to 20,544.
Suffice it to say, Nio’s second-quarter results should greatly exceed the automaker’s first-quarter results. Thus, I believe that sooner or later, the market will see Nio’s operational improvements and adjust the share price accordingly.
Nio Stock Under $5 Is a Steal
Are you ready for the big turnaround? Nio’s recently released EV delivery figures indicate ultrapowerful growth. At the same time, international trade war jitters are probably already discounted into Nio shares.
Hence, if Nio stock is below $5 when you’re reading this, I encourage you to grab a handful of shares. Nio’s comeback story will be amazing, and you’ll want to be in the trade before the market suddenly favors Nio again.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
