Chinese luxury electric vehicle maker Nio stock delivered 15,959 vehicles for November, marking an increase of 12% from November 2022, although the numbers were slightly lower on a sequential basis. While Nio didn’t spell out what drove its growth, the company likely benefited from higher sales of the updated ES6 SUV, which debuted in May, while the price cuts carried out over Q2 also likely helped drive demand to an extent. Overall Nio has delivered 142,026 vehicles year-to-date in 2023, marking an increase of 33% compared to the last year. Nio’s growth rates continue to fall meaningfully behind rivals who posted even stronger monthly deliveries. For example, Li Auto delivered a record 41,030 units, up roughly 2.7x year-over-year, driven by strong demand for its three L-Series models which combine gasoline generators to extend the range of its EVs. Xpeng also sold a record 20,041 units, up 2.4x from November 2022.
NIO stock has suffered a sharp decline of 85% from levels of $50 in early January 2021 to around $7 now, vs. an increase of about 25% for the S&P 500 over this roughly 3-year period. Notably, NIO stock has underperformed the broader market in each of the last 3 years. Returns for the stock were -35% in 2021, -69% in 2022, and -27% in 2023. In comparison, returns for the S&P 500 have been 27% in 2021, -19% in 2022, and 20% in 2023 – indicating that NIO underperformed the S&P in 2021, 2022, and 2023. In fact, consistently beating the S&P 500 – in good times and bad – has been difficult over recent years for individual stocks.
In contrast, the Trefis High Quality Portfolio, with a collection of 30 stocks, has outperformed the S&P 500 each year over the same period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.
Given the current uncertain macroeconomic environment with high oil prices and elevated…
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