Nio Inc

NIO Inc (NYSE: NIO) is the leading manufacturer of smart electric vehicles in China. The leading products are ES8, ES6, EC6 and EP9 supercar.

Investment Rationale – Watch at USD 38.26

• The Company had witnessed a wider net loss during Q2 FY21 as compared to Q1 FY21.
• All major profitability metrics remained in negative territory from the last five quarters (Q2 FY20 to Q2 FY21), while the industry median of all profitability metrics fell into the positive territory.
• The consensus estimates had indicated that NIO would incur a loss for at least three more years.
• From a technical standpoint, the stock is trading lower than the 20-day exponential moving average of USD 40.53, indicating that the stock could decline in the near term.
• Furthermore, the MACD line remained lower than the signal line, indicating a correction in the stock price.

One Year Share Price Chart

 (Data Source: Refinitiv, Analysis by Kalkine Group)

Conclusion

Based on the quarter-on-quarter increase in net loss during Q2 FY21 and unfavourable technical indicators, we have given a “WATCH” recommendation on Nio Inc at the closing market price of USD 38.26 (as on 26 August 2021). However, if the clients already have this stock in their portfolio, they can look for booking profit (if bought at lower level) or hold it as per their own analysis and risk/return trade-off strategy.

Niu Technologies

Niu Technologies (NASDAQ: NIU) is engaged in the manufacturing of high-performance smart e-scooters.

Investment Rationale – WATCH at USD 26.02

• The revenue per e-scooter had shown a decline of around 7.3% during Q2 FY21 as compared to Q2 FY20.
• The selling & marketing expenses as a percentage of revenues had increased from 6.60% during Q2 FY20 to 7.00% for Q2 FY21.
• The rapid spread of coronavirus on a global level may impact the performance of the Electric Vehicles industry to a larger extent.
• From a technical standpoint, the stock is trading between the middle Bollinger band and the upper Bollinger band, indicating a correction in the stock price.

One Year Share Price Chart

 (Data Source: Refinitiv, Analysis by Kalkine Group)

Conclusion

Based on the uncertain outlook and unfavourable technical indicators, we have given a “WATCH” recommendation on Niu Technologies at the closing market price of USD 26.02 (as on 26 August 2021). However, if the clients already have this stock in their portfolio, they can look for booking profit (if bought at lower level) or hold it as per their own analysis and risk/return trade-off strategy.

Triterras Inc

Triterras Inc (NASDAQ: TRIT) is a fintech company focused on trade and trade finance related to commodities.

Investment Rationale – AVOID at USD 5.42

• The Company had not yet released full-year results for the 12 months ended 28 February 2021. Moreover, they received notification from NASDAQ regarding the delay in publishing results.
• On the liquidity front, the current ratio of 0.04x remained significantly lower than the industry median of 1.74x during Q3 FY20.
• In terms of a technical indicator, the stock price is hovering between the upper Bollinger band and the middle Bollinger band, suggesting a correction in the stock price.
• The lack of recent financial data had created doubts regarding the earning potential of TRIT.

One Year Share Price Chart

 (Data Source: Refinitiv, Analysis by Kalkine Group)

Conclusion

Based on the lack of recent financial data and unfavourable technical indicators, we have given an “AVOID” recommendation on Triterras Inc at the closing market price of USD 5.42 (as on 26 August 2021). However, if the clients already have this stock in their portfolio, they can look for booking profit (if bought at lower level) or hold it as per their own analysis and risk/return trade-off strategy.

GTT Communications Inc

GTT Communications Inc (OTC: GTTN) is engaged in providing cloud networking services to multinational companies and government customers around United States, Europe, and other international markets.

Investment Rationale – AVOID at USD 0.41

• The stock is highly volatile as it had shown a significant drop of more than 90% in the last one year.
• NYSE had suspended trading in GTT Communications and delisted the stock as it did not meet the stringent listing requirements.
• The latest financial results available as of Q1 FY20 captured three months period that ended on 31 March 2020, creating doubts regarding the growth prospects of GTTN.
• From a technical standpoint, the stock price is trading lower than the 20-days exponential moving average of USD 0.53, making it difficult for the stock price to show an upside potential.

One Year Share Price Chart

 (Data Source: Refinitiv, Analysis by Kalkine Group)

Conclusion

Based on the lack of recent financial data and the volatile nature of the stock, we have given an “AVOID” recommendation on GTT Communications Inc at the closing market price of USD 0.41 (as on 26 August 2021). However, if the clients already have this stock in their portfolio, they can look for booking profit (if bought at lower level) or hold it as per their own analysis and risk/return trade-off strategy.

*The reference data in this report has been partly sourced from REFINITIV.