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NIO Stock: 11 Things to Know as Nio Shares Stumble Today

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Nio shares are stumbling thanks to U.S. delisting threats. But what else do investors need to know?

By Sarah Smith, InvestorPlace Web Content Producer Dec 21, 2020, 9:50 am EST

Things are not looking good for Nio (NYSE:NIO), the Chinese electric vehicle maker, on Monday morning. Despite a recent rally, shares are deep in the red. So what is behind this move in NIO stock? And what else do investors and EV bulls need to know?

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To start, investors should know that NIO stock was down as much as 6% this morning. This comes after the company completed its secondary offering, and after President Donald Trump signed a high-profile bill into law. Now, with the Holding Foreign Companies Accountable Act stoking fear, it seems that Nio shares are slipping.

With that in mind, here are 11 things to know about NIO now:

Are Things Really All That Bad for NIO Stock?

Importantly, the red-hot EV maker still has plenty of fans. Just last week, InvestorPlaceanalyst Luke Lango reminded investors that Nio is a leader in the EV revolution. Because of that, and because of the growth potential for electric vehicles in China, he has a 2020 price target of $55. With just a few days left in the year, that target represents appealing upside of more than 20%.

Plus, some things are definitely working in favor of the company. Earlier in December, reports circulated that Nio had signed a deal with Intel (NASDAQ:INTC) unit Mobileye. According to those reports, the two companies were working together on a fleet of robotaxis. This comes after a November 2019 large-scale supply deal and the launch of test drives in Israel.

Lastly, news over the weekend from Chinese media outlets like Sina Finance seems to confirm that big things are coming for NIO stock. Rumor has it that Beijing is considering upping its investment in GAC, the automaker behind production of Nio vehicles. If all goes right, the GAC Nio headquarters and production base could move to Beijing. If these reports are correct, Sina Finance says investors should expect final confirmation of the deal and transaction terms at the end of the month.

Although Nio and its Chinese peers will certainly have to navigate the new auditing landscape, there is reason to believe the companies will do just that. Keep an eye on NIO stock, especially as it courts the favor of the Beijing government. That sort of institutional support could take the EV darling a long, long way.

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