Goldman Sachs Upgrades NIO to Buy, $7 Price Target

Goldman Sachs analyst Tina Hou upgraded NIO (NYSE: NIO) from Neutral to Buy with a price target of $7.

“We upgrade Nio to Buy with 12-month DCF-based target prices of US$7.0/HK$55, implying 46%/42% upside potential.

Among our coverage, we expect Nio to not only deliver one of the fastest volume growth, but also a premium margin profile and strong profit/FCF turn-around in 2026E.

This is supported by the company’s successful turnaround with the launch of new ES8/ES9 together with leading brand power, strengthening its position in the premium NEV market, which we believe creates a higher competitive moat and is more difficult to displace by competitors.

Looking ahead, we believe the company can apply similar strategy to its 5 series and 6 series models and rejuvenate the sales volume of these models in 2027E and beyond, driving continued market share gain.

Despite the domestic NEV market growth of -14% yoy in 1H26, Nio expanded its volume by +67% yoy.

For 2026E full year, we model volume/revenue growth of +43%/+60% yoy, and non-GAAP net profit of Rmb1.6bn (vs. loss of Rmb12.4bn in 2025), we also expect free cash flow to meaningfully improve from Rmb-3.1bn in 2025 to Rmb12.1bn in 2026E.

However, shares are down -6% YTD and -32% from its recent peak in Apr 2026, which is disconnected from the companies improving fundamentals, in our view.

Compared with pure-NEV peers under our coverage, Nio is also trading at a 25%/29% discount on 2026E/27E P/S and 17% discount on 2027E P/E, which we see as attractive given its near term product momentum and strong growth.”

This research note is reproduced verbatim from the issuing firm. Price Target never edits, paraphrases or alters analysts’ words — we only republish them in one place.