5 EV Winners Of Trump’s Softened Stance On China Tariffs

1. NIO Inc (NYSE:NIO)

Nio stock was down 4% yesterday, not depicting the same enthusiasm that other Chinese EV stocks did after Trump’s softened stance on tariffs. That’s because the company has a lot more on its plate than just tariffs. The stock is down 30% in a year and the business performance doesn’t inspire much confidence in the short-term, though the company could turn that around.

NIO’s biggest headache is its shrinking cash position. That is unlikely to improve unless the company innovates to thwart competition from the likes of Tesla and other Chinese EV companies. Even though its cash is at similar levels as Xpeng, it has already burnt through $1.7 billion in the first three quarters of the year.

There are still some positives for investors to look forward to. For example, the recent joint venture with CYVN Holdings targets the North African and Middle Eastern markets. There is also the partnership with Mastercard which enables the company to expand into international markets. We still don’t know the financial impact of these deals but if the management pursues these ambitions successfully, these offer the new growth opportunities that the company needs to stop its decline.

NIO is not on our latest list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 20 hedge fund portfolios held NIO at the end of the third quarter which was 20 in the previous quarter. While we acknowledge the potential of NIO as a leading AI investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NIO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.