Our updated Discounted Cash Flow (DCF) analysis indicates that the fair value of NIU Technologies' stock is approximately $5.80, slightly above its current price of $4.52 (as of March 29, 2025).
NIU has posted impressive quarterly results, with a 71.1% year-over-year revenue growth in Q4 2024, totaling 819.2 million RMB. The company sold 226,634 e-scooters, a substantial portion of which were sold internationally. Additionally, it reported a net profit of 72.5 million RMB, a significant improvement over the loss in the same period last year. However, its gross margin has declined to 12.4%, down from 19.0% in the previous year, which may be a concern moving forward. (Taiwan News)
Given the positive momentum in sales and profitability, we estimate a 15% annual growth rate for the next five years. The long-term growth rate is expected to stabilize at 3%. Using a WACC of 10%, the fair value of the stock appears to be $5.80, suggesting that NIU’s shares are slightly undervalued at the current price.
Risks include potential pressure on margins due to competition, global supply chain challenges, and broader macroeconomic conditions. Investors should weigh these factors before making decisions.
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Disclaimer
The user Marco_iltedesco holds no position in NasdaqGM:NIU. Simply Wall St has no position in any of the companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.