This Penny Stock is Lagging in 2019, Will It Ever Recover: Nio (NYSE:NIO)
The electric car market in China grew at a decent clip over the past few years. One of the companies that emerged as one of the winners was Nio Inc (NIO Stock Report). However, 2019 hasn’t been a kind year for the company at all. Throughout the course of the year, this has been one of the penny stocks that has struggled due to a wide range of issues.
While Tesla (TSLA Stock Report) has steadied over the past few months, the same cannot be said of NIO stock. The company has failed to garner the sort of momentum that many of its investors might have wanted. This penny stock continues to slide and there could be legitimate questions about whether NIO can actually survive in the long run.
Penny Stocks To Buy (Or Sell): Nio Inc
Many seem to be under the impression that NIO has the same stature in China as Tesla has in the United States. But nothing could further from the truth. Due to the Chinese government’s push for more electric cars, there are now around 500 companies in the country. The sales generated by NIO make up around 2% of the aggregate. NIO only sold a grand total of 827 cars in July. Additionally, the company continues to burn a lot of cash that eventually can lead to massive losses.
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NIO has a lot of publicity since it is the only electric car company from China which has listed in the United States. However, that has not translated into much. Currently, the share price is hovering around 2.7%. Analysts believe that the revenues are going to grow by 126% this year. However, even though that figure looks impressive in isolation, it doesn’t help NIO much. That’s since the company is likely to continue to make massive losses.
That being said, the fact that the company has been able to produce a high-quality car definitely adds to the possibility of a takeover in the future. However, most analysts have recommended against buying the stock at this point in time. NIO stock is down about 70% from its February peak price of $10.64. Needless to say, is it still one of the names on the list of penny stocks to buy this month?
