Nio Stock Falls After Short Seller Report Allegations

Nio formed an independent committee to investigate the claims

Deputy Editor
Jul 11, 2022 at 9:41 AM
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Nio Inc (NYSE:NIO) is down 3.6% in premarket trading, last seen at $21.78, following some serious allegations revealed in a short sell report. Specifically, short-selling firm Grizzly Research accused the electric vehicle (EV) maker of exaggerating its revenue and profit margins, though Nio said that the allegations were without merit and is forming an independent committee to investigate the claims. 

NIO is staring up at multiple long-term moving averages on the charts, most notably the 160-day trendline that kept a mid-June pop in check. The $21 region appears to have formed a level of support in recent weeks, however, while Nio stock sports a 28.7% year-to-date deficit. 

Options traders are more bearish than usual toward the EV staple. This is per NIO's 50-day put/call volume ratio of 0.77 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than 98% of readings in its 12-month range. In other words, while calls still outnumber puts on an overall basis, long puts are getting picked up at a quicker-than-usual clip. 

Analysts, meanwhile, are firmly bullish. In fact, eight of the nine carry a "strong buy" rating, while the one calls NIO a tepid "hold." Plus, the 12-month consensus price target of $36.35 is a hefty 60.8% premium to Friday's close.  

 

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