Tesla rival NIO surges 12% after Macquarie upgrades stock

Investing.com– Chinese electric vehicle maker NIO Inc (HK:9866) rose sharply in Hong Kong trade on Tuesday after Macquarie upgraded the stock, citing improved expectations for the company’s upcoming earnings.

NIO rose 12.2% to HK$46.60, tracking a 10.5% overnight rally in its American Depository Receipts (NYSE:NIO). 

Macquarie upgraded the stock to Outperform from Neutral, while hiking its target price to HK$65 from HK$52.  

Macquarie said it expected strong third-quarter earnings from the firm, and also expected Nio to post strong guidance for the fourth quarter on a pick-up in sales volumes. 

Increased sales were driven by the launch of Nio’s new mass market model, the ONVO L60, earlier this year. Deliveries of the model, which is aimed at competing with Tesla Inc’s (NASDAQ:TSLA) Model Y, began in September.

Nio clocked record-high deliveries in the September quarter, at 61,855 vehicles sold, despite persistent competition amid an ongoing price war in Chinese markets.