Goldman Sachs raised its rating on Nio to Buy from Neutral and boosted its 12-month price targets to $7 for the American Depositary Receipts and HK$55 for the Hong Kong-listed shares, each implying about 47% upside from current levels. The upgrade reflects the bank's view that Nio is positioned to deliver rapid volume expansion alongside an improved margin profile and a meaningful profit and free-cash-flow turnaround in 2026E.
In U.S. premarket trading the stock climbed about 2% by 08:49 ET (12:49 GMT) following the research note. Goldman highlighted the strong reception for Nio's latest large SUVs, the ES8 and ES9, as a key driver of its revised stance on the company.
Analysts at Goldman pointed to the ES8 and ES9 launch as having secured the No. 1 position in China for the new-energy-vehicle segment priced above 400,000 yuan, capturing 39% market share in that bracket. That product momentum stood out to the bank even as the broader domestic NEV market contracted, with a 14% year-over-year decline in the first half of 2026. Over the same period, Nio's own volumes expanded by 67% year-over-year.
Goldman set out specific 2026 projections, forecasting full-year volume growth of 43% and revenue growth of 60%. The brokerage expects Nio to swing to an adjusted net profit of 1.6 billion yuan in 2026 from an adjusted net loss of 12.4 billion yuan in 2025. Free cash flow is forecast to move from negative 3.1 billion yuan in 2025 to positive 12.1 billion yuan in 2026.
Despite the expected operational improvement, Nio's equity performance has lagged year-to-date, with shares down 6% and off 32% from an April 2026 peak. Goldman described this price action as "disconnected from the company’s improving fundamentals." The bank also noted that Nio currently trades at a discount to its pure-EV peers, specifically 25% to 29% lower on 2026-2027 price-to-sales multiples and about a 17% discount on 2027 price-to-earnings.
Goldman identified potential near-term catalysts that could support the shares, including the ramp-up of deliveries for a five-seater version of the ES8 and evidence of profit improvement in upcoming earnings prints. The firm said its 2026-2028 earnings estimates sit roughly 30% above Visible Alpha consensus, a gap Goldman attributes to higher revenue assumptions and lower operating expense assumptions driven by stable pricing and more efficient marketing spend tied to the company's premium brand strength.
The Wall Street firm also adjusted its 2026-2028 earnings estimates, raising them by a range of 1% to 9%, with the increases mainly reflecting higher gross margins associated with strong ES8 and ES9 sales. Looking beyond the flagship models, Goldman suggested the company could pursue a similar turnaround strategy for its 5 series and 6 series vehicles - models priced between 200,000 and 400,000 yuan - with the aim of "rejuvenat[ing] the sales volume of these models in 2027E and beyond."
Context and implications
Goldman’s upgrade is driven by product-level gains for Nio in the high end of the NEV market and by a set of financial forecasts that anticipate a return to profitability and free cash flow generation in 2026. The bank also points to relative valuation discounts versus pure-EV peers as an additional rationale for a more positive stance on the shares.