Funding bankers aren’t at all times appropriate in regards to the shares they advocate shopping for (or promoting). However there’s one factor you may depend upon them being helpful for: Getting direct entry to firm administration, and digging out information that will curiosity different traders. Final week, Deutsche Financial institution analyst Edison Yu carried out this service for out of doors traders when he was capable of host Steven Feng, and get the NIO (NIO) CFO to offer some perception into the Chinese language electrical automobile firm’s future plans throughout “digital investor conferences.” In a wide-ranging dialogue, Feng revealed NIO’s plans for the long run as regards: Persevering with to develop its “premium/luxurious” China enterprise.Constructing an EV to compete with the upcoming Tesla Mannequin 2.Increasing its enterprise into Europe. Constructing the model in China NIO believes that it presents clients in China a superior “possession expertise” to what Tesla can provide. Though traders would possibly fear that worth cuts instituted within the nation on Tesla’s Mannequin Y crossover EV would possibly eat into NIO’s enterprise, Feng says that, on the contrary, in China Tesla tends to serve a helpful goal by attracting house owners of conventional inside combustion engine automobiles to the thought of proudly owning an electrical car. However as soon as they’re , clients usually desire to purchase a NIO. Why? Title recognition is one issue. Feng says that inside China, NIO has 80% model consciousness, and is admired for its inside design, dealing with/suspension, and “post-purchase service” — particularly its know-how that allows batteries in NIO automobiles to be “chargeable, swappable, and upgradeable” (to batteries with longer vary). 55% of NIO house owners as we speak subscribe to the corporate’s “Battery-as-a-Service” plan, shopping for their automobiles, however subscribing to the batteries that run them. And NIO plans to roll out autonomous driving software program as a $100-a-month subscription providing starting in Q1 2022. Tesla, in distinction, sells its batteries built-in into its automobiles — and sells it autonomous driving software program bundle as an improve. Taking over the Tesla 2 Equally, Feng sees Tesla’s upcoming economic system mannequin Tesla 2 as extra of a possibility than a menace. NIO plans to maintain its concentrate on the luxurious market in China, but additionally develop a brand new model of cheaper EVs to compete with the Tesla 2, rising its manufacturing quantity of automobiles bought at cheaper price factors “within the subsequent few years.” This manner, confides Feng, NIO can “preserve its premium repute whereas the corporate goes after increased development.” Worldwide growth NIO’s ambitions aren’t restricted to China, both. On the contrary, the corporate is already planning to develop into the European market later this yr. Whereas in China, the corporate targets 25% to 30% market share within the premium EV phase, in Europe, NIO says will probably be happy with simply 10% to fifteen%. The corporate plans to supply “customized tailor-made” European choices to the native market. And to assist all this growth, NIO — which bought fewer than 44,000 automobiles final yr — plans to develop its manufacturing capability to 150,000 automobiles per yr by the tip of 2021. Even then, NIO will not be executed. In accordance with Feng, the corporate sees its whole addressable market worldwide as nearer to 700,000 automobiles yearly. Purchase Score Based mostly on the entire above, Yu charges NIO shares a Purchase together with a $70 worth goal. The implication for traders? Upside of 56%. (To observe Yu’s observe file, click on right here) Wall Avenue is broadly in settlement with this evaluation. During the last couple of months, NIO has obtained 7 Purchase scores from Avenue analysts, in comparison with 3 Holds. With a median worth goal of $65.24 per share, the potential upside stands at 45%. (See NIO evaluation on TipRanks) To seek out good concepts for EV shares buying and selling at engaging valuations, go to TipRanks’ Greatest Shares to Purchase, a newly launched device that unites all of TipRanks’ fairness insights. Disclaimer: The opinions expressed on this article are solely these of the featured analyst. The content material is meant for use for informational functions solely. It is extremely vital to do your personal evaluation earlier than making any funding.