NIO profits beat estimates. Why a rising stock is a surprise.

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NIO

the stock edged up after the electric vehicle maker beat forecast. This is usually not the case.

NIO recorded a loss of 7 cents on sales of $ 1.31 billion. Wall Street forecast a loss of 8 cents per share on sales of $ 1.28 billion. In the first quarter, NIO lost 4 cents a share on revenue of $ 1.23 billion.

The top line broke analysts’ forecasts by around 2%. That’s a solid number, but it’s similar to the 1% beat when NIO released Q4 2020 numbers. Shares fell 12.9% the day after this report.

Such a severe drop might come as a surprise, but investors generally expect a lot from NIOs. Shares have fallen eight in the previous 11 quarters reported by the company.

So far, however, the stock, up 1.1% to $ 44.45 as of 5:55 p.m. EST, appears to be on solid footing.

Looking ahead, NIO management expects third quarter deliveries to reach 23,000 to 25,000 vehicles. This represents approximately 8,000 vehicles per month and corresponds to the monthly capacity of the company. NIO sells all the cars it can make.

During the second quarter, NIO delivered 21,896 vehicles during the second quarter, in the upper range of forecasts given in April for deliveries of 21,000 to 22,000 vehicles.

Third quarter sales are expected to be around $ 1.44 billion. That’s better than analysts’ forecast of $ 1.38 billion.

Overall, the numbers look good. And NIO management is holding a conference call at 9 p.m. EST to discuss the results. It’s a late call, but the leadership is in China. Investors will be looking for an update on production capacity and the second half of 2021.

NIO stock is down around 10% so far in 2021, entering the earnings report. This is behind the respective comparable gains of 18% and 16% of the

S&P 500

and

Dow Jones Industrial Average.

NIO stocks also lag behind the stocks of their peers

XPeng

(XPEV) fell about 2%.

Li Auto

(LI) the stock is up around 7% year-to-date. Still, NIO shares have risen by around 240% in the past 12 months and are up 1,109% in 2020.

XPeng and Li are expected to release their second quarter results later in August.

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