Goldman Sachs: NIO (NIO.US/9866.HK) — Industry-Leading Growth & Premium Margin Profile with Attractive Valuation; Upgrade to Buy from Neutral
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Key Views
The new ES8 and ES9 models are central to NIO's product refresh. The ES8 leads the over-RMB 400k SUV segment with monthly sales exceeding 10k units. Goldman Sachs expects 2026 volume growth of 43% versus just 1% for the industry, with 2027/2028 growth of 19%/11%. Vehicle gross margin is projected at 17% in 2026, above the peer average of 15%, with ES9/ES8 margins exceeding 25%/20%.
The firm forecasts non-GAAP net profit of RMB 1.6 billion in 2026, a swing from a RMB 12.4 billion loss in 2025. Free cash flow improves from negative RMB 3.1 billion to positive RMB 12.1 billion. SG&A as a percentage of revenue drops from 18.4% to 11.1%.
Outlook
The current share price has fallen 32% from its April 2026 peak. Goldman Sachs views this pullback as disconnected from improving fundamentals. NIO trades at a 25%/29% discount to pure NEV peers on 2026/2027 P/S.
Recommended Securities
- NIO (NIO.US): Buy, 12-month target price USD 7.0
- NIO (9866.HK): Buy, 12-month target price HKD 55
Key exhibits
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