Goldman Sachs upgraded Chinese electric vehicle maker Nio (NIO, Financials) to Neutral from Sell and raised its 12-month price target to $3.80 from $3.70, citing recent cost-cutting measures and a decline in share price. The updated target implies a potential upside of about 9% from current levels.
Goldman Sachs analyst Tina Hou noted that Nio's efforts to reduce operating expenses by 20%–25%—including project cancellations, staff reductions, and streamlined operations—could support margin improvement of 4%–10% over the next three years. Nio has faced challenges, including widening losses, a 21% year-to-date share price drop, and heightened competition from Tesla (TSLA, Financials) and BYD.
Despite the upgrade, Goldman Sachs remains cautious. It cited weak demand, a high debt load, and reduced delivery expectations as ongoing risks. Nio's cash and investments declined from $5.7 billion to $3.6 billion in Q1 2025, underscoring balance sheet concerns.
Wall Street maintains a Hold consensus on Nio stock, with two Buy, seven Hold, and one Sell ratings over the past three months. The average analyst price target is $4.58, suggesting a 33% upside.
