We recently compiled a list of the 12 Small Cap EV Stocks to Buy Now. In this article, we are going to take a look at where NIO Inc. (NYSE:NIO) stands against the other small-cap EV stocks.
In 2024, electric vehicles (EVs) represented 8.1% of the 16 million vehicles sold in the United States, according to Cox Automotive. While this was a record share, it was still below the 10% that analysts had expected at the beginning of the year. Despite this, some believe that the EV market may be picking up pace.
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Despite the fact that overall EV adoption has been slower than expected, brands like Cadillac are expanding their electric lineup. By the end of 2025, Cadillac plans to offer five EVs. These include the Escalade IQ, Optiq crossover, Lyriq, the upcoming three-row Vistiq, and the luxury Celestiq. Cadillac expects roughly one in three vehicles it sells in the US this year will be all-electric.
Brad Franz, Cadillac’s director of marketing, told CNBC that the company is launching EVs to grow its business and attract new customers to the brand instead of just shifting sales from gas-powered cars. According to Franz, the EV portfolio will offer customers more choices. In 2024, the company sold about 29,000 EVs. For 2025, Cadillac aims for EVs to make up between 30% to 35% of its sales in the US.
However, Cadillac has abandoned its earlier plan to sell only EVs by 2030. Instead, the company said that customer demand will determine the elimination of gas-powered vehicles.
This approach reflects a broader trend. A number of automakers have turned their back on plans to exclusively sell EVs in the near future as customer adoption has not been as fast as expected.
Methodology
To compile our list of the 12 small-cap EV stocks to buy now, we reviewed our own rankings and consulted various online resources to compile a list of the best small-cap EV stocks. Please note that we defined small-cap stocks as those with a market capitalization between $500 million and $10 billion. From an initial pool of more than 20 small-cap EV stocks that met our criteria, we focused on the top 12 stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q4 2024 database of more than 1,000 elite hedge funds. The 12 small-cap EV stocks to buy now were then ranked in ascending order based on the number of hedge funds holding stakes in them as of Q4 2024.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A fleet of eco-friendly electric cars, a symbol of the company’s commitment to sustainability.
NIO Inc. (NYSE:NIO)
Market Capitalization: $8.65 Billion
Number of Hedge Fund Holders: 20
NIO Inc. (NYSE:NIO) is a leading company in the global electric vehicle market based in Shanghai, China. The company designs, develops, manufactures, and sells smart electric vehicles. It offers premium smart EVs under the NIO brand, family-oriented smart EVs through the ONVO brand, and small smart high-end electric cars with the FIREFLY brand. NIO Inc. (NYSE:NIO) is one of the best EV stocks to buy now.
The company officially launched its small smart high-end electric car, firefly, on April 19, 2025, and started deliveries in China in late April 2025. The company has plans to reach global markets soon. Overall, in April 2025, NIO Inc. (NYSE:NIO) delivered 23,900 vehicles in total, an increase of 53% year-over-year.
On April 28, Citi maintained its “Buy” rating on NIO Inc. (NYSE:NIO) with a price target of $8.10. Following the Shanghai Auto Show, the firm’s analyst expects that the company will launch new models sooner than the market anticipates. The analyst expects these new models will benefit from lower Bill of Materials costs and cost-saving synergies. The analyst also noted an uptick in orders and Citi’s analysis indicated that NIO Inc. (NYSE:NIO) could see deliveries reach 63,000 units in Q2, an increase of 50% year-over-year. Further growth is also expected, with projections of 100,000 to 120,000 units for Q3 and 120,000 to 150,000 units for Q4. Citi’s positive outlook is based on three main factors: the launch of new models, new Advanced Driver-Assistance Systems (ADAS) and chips, and improved cost savings.
Overall, NIO ranks 11th on our list of small-cap EV stocks to buy now. While we acknowledge the potential of NIO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than NIO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.