NIO Leads Stock Markets Higher on Strong Vehicle Sales; ADT gets Googled for smart home security
The stock market has been in tears since its March lows and investors remain optimistic about its prospects of continuing higher. Even with many COVID-19 worries, market participants are eagerly watching Washington to see if another round of massive fiscal stimulus will take place in the near future. Just before 11 a.m. EDT, the Dow Jones Industrial Average (DJINDICES: ^ DJI) was up 132 points to 26,560. S&P500 (SNP INDEX: ^GSPC) rose 15 points to 3,287, and the Nasdaq Compound (NASDAQ INDEX: ^IXIC) gained 99 points to 10,844.
A Chinese newcomer in the field of electric vehicles NIO (NYSE: NIO) has caught the eye of growth investors, and its latest July results have boosted its stock significantly. Even bigger gains were in store for the home security specialist ADT (NYSE:ADT), which announced a major collaboration with Alphabetit is (NASDAQ:GOOG) (NASDAQ:GOOGL) Google division to add a high-tech element to its offerings.
A special delivery for NIO shareholders
Shares of NIO soared nearly 11% on Monday morning. Shareholders reacted positively to the latest news from the Chinese electric vehicle company, which released its July delivery figures.
NIO saw a huge increase in demand for its SUVs in July. Total vehicle volume was 3,533, more than four times what NIO delivered in July 2019. The number of deliveries included 2,610 of NIO’s ES6 electric SUVs and 923 of its larger ES8 models.
Additionally, NIO is eagerly awaiting the release of its latest model. The EC6 is an electric coupe that seats five, and NIO began taking pre-orders for the car in July. The automaker sees the EC6 appealing to a different user base, including younger customers who want a sporty and sleek design. EC6s will start shipping in September.
NIO’s stock price has already tripled since the end of May, so there’s already a lot of excitement in the stocks. Nevertheless, with such a market opportunity, NIO has a long growth track ahead of him if he can execute his trading strategy well.
Take advantage of security
ADT did even better on Monday morning, with its stock soaring 65%. A deal with a tech giant was more than enough to get investors excited about the home security specialist.
ADT has entered into a long-term partnership with Alphabet’s Google under which the technology company will invest $450 million to release a new generation of smart home security products. In exchange, Google will receive a 6.6% stake in ADT shares. The two companies also agreed to commit $150 million each for start-up expenses, including marketing, product development, technology and employee training.
The general idea is that the two companies combine Google’s machine learning expertise and Nest smart home hardware with ADT’s home security prowess. As part of the agreement, ADT is ready to provide installation assistance, as well as professional service and monitoring to ensure a continued positive experience for customers.
The partnership should be operational. ADT is looking to ship Google devices before the end of 2020, with further expansion next year. With the investment in its business, ADT hopes to accelerate its pace of development to deliver even more innovative products.
ADT has been threatened by competition, but getting Google on its side proves the company’s industry-leading role. Investors have high hopes for the future, even though Google’s investment price implies a company valuation of just $6.75 billion, well below Google’s $11 billion market capitalization. ADT after today’s high.
This article represents the opinion of the author, who may disagree with the “official” recommendation position of a high-end advice service Motley Fool. We are heterogeneous! Challenging an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and wealthier.