We recently compiled a list of the 10 Chinese Penny Stocks to Buy According to Analysts. In this article, we are going to take a look at where NIO Inc. (NYSE:NIO) stands against other Chinese penny stocks to buy according to analysts.
The announcement of the Chinese stimulus has somewhat created interest among investors and market pundits. China’s local market reacted positively after the government announced that it would apply a ‘moderately loose’ strategy for monetary policy in 2025. This will be China’s first major shift in economic policy since 2011. The Chinese government could take a more proactive approach to fiscal policy to stabilize property and stock markets.
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China’s President Vows to Meet Growth Target
China’s president, Xi Jinping, has assured that the country will remain the world’s ‘growth engine’ and meet its GDP growth target of 5% in 2024. The Chinese government has taken bold steps to support its economy. Moreover, the stimulus has come at a time when the economy is struggling badly and there are potential tariff threats from the new U.S. administration. Despite that, China has been facing lower imports and exports, which greatly threatens the economy against Trump’s tariffs.
The outbound shipments saw a 6.7% growth in November, missing estimates by 8.5% and down from a 12.7% growth in October 2024. On top of that, the imports declined 3.9% in November, the worst performance for imports in nine months, as reported by Reuters.
China’s stimulus of $1.5 trillion, or nearly 10 billion yuan, to support its economy has given some hope. Further loosening the policy would support small businesses. However, for investors to be attracted to the Chinese stock market, something positive needs to happen, especially how the economy reacts to the policy during the first half of 2025.
“The actual delivery has disappointed high hopes several times already over the past two years. We are back to the tricky stage of waiting for actual numbers to see whether it lives up to expectations,” said Xin-Yao Ng, investment director on the Asian equities team at abrdn.
The Hang Seng Index has plunged over 3% over the last five days, as of December 17, while the CSI 300 index has dropped by nearly 1.50% in the last five days but it is up by almost 16% year to date. We can see the market’s mixed reaction to the recent events.
You can also visit and see 12 Cheap Chinese Stocks to Buy According to Hedge Funds.
A fleet of eco-friendly electric cars, a symbol of the company’s commitment to sustainability.
Our Methodology
To compile our list of the 10 Chinese penny stocks to buy according to analysts, we used a Finviz screener to list down all Chinese penny stocks under $5. We then picked the 10 stocks with the highest upside (over 25%) according to analysts, as of December 17. The list is ranked in ascending order of analysts’ estimated upside.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
NIO Inc. (NYSE:NIO)
Share Price (As of December 17): $4.42
Analysts Upside: 35%
NIO Inc. (NYSE:NIO) is a prominent electric vehicle company that specializes in premium smart EVs. The company is recognized for its battery swapping technology and Battery as a Service (BaaS) model, which provides customers with adaptable battery subscription options. NIO recently introduced its mass-market brand ONVO, which began selling vehicles equipped with features like battery swapping and support for various battery ranges in September 2024. In addition to that, some of the prominent products of NIO include ES8, ES6, EC6, and ET7. NIO mainly conducts its business in the domestic market.
NIO Inc. (NYSE:NIO) continues to increase its deliveries and November marked the seventh consecutive month of delivering over 20,000 EVs. Moreover, a “more proactive” fiscal policy in 2025 and the Chinese stimulus will assist NIO, potentially increasing its EV unit sales. NIO holds around 2.1% of the EV domestic market share in China. The company has diversified its business and is investing in new technologies in the EV industry.
Moreover, NIO has announced that its flagship executive sedan has been approved by China’s Ministry of Industry and Information Technology (MIIT). NIO’s upcoming ET9 luxury sedan, set to launch in Q1 2025, will be the first mass-produced car equipped with steer-by-wire technology. This will also be the first mass-produced vehicle with steer-by-wire technology in China. This technology enhances handling and driver experience and is aimed at executive-level buyers with a starting price above $110,000.
Overall, NIO ranks 8th on our list of Chinese penny stocks to buy according to analysts. While we acknowledge the potential of NIO to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than 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 is originally published at Insider Monkey.