Shares of Nio Inc. NIO,
fell 1.0% in premarket trading on Tuesday, easing slightly after closing the case back after Citigroup analyst Jeff Chung withdrew from his alcoholic position vis-à-vis China’s electric vehicle maker, citing competition concerns Tesla Inc.
Also pressuring the action, Nio said late Monday that it offers a $ 1.3 billion convertible debt, which can be converted after August 1, 2025 into shares or cash. Nio’s shares closed at record highs in the last two sessions, while investors cheered over the weekend’s unveiling of the company’s ET7 luxury sedan. “ET7 is good, but not enough to make critical changes to Tesla’s challenge,” Chung wrote in a note to customers. He estimates that ET7 will record “limited incremental sales” of 3,000 to 4,000 units per month starting in the first quarter of 2022 and is likely to be potentially provoked by a Tesla Model-S facelift in the future. Tesla shares rose 2.9% before opening Tuesday, after the stock fell 7.8% Monday to a record 11-day winning streak. In the last three months, Nio shares have risen 187.0% and Tesla shares have risen 83.4%, while S&P 500 SPX,
gained 7.5%.