Li Auto Inc ADR

LI: XNAS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$51.60	Nwxsz	Bqnyfmgw

Li Auto Earnings: Solid Results; Growing Concern Over Competition and Profitability

Vincent Sun

Nov 10, 2023

Li Auto's third-quarter revenue was 4% above the high end of its guidance. Vehicle margin of 21% staged a stable trend sequentially from last quarter, with economies of scale offsetting the impact of price promotions since August. Fourth-quarter vehicle delivery guidance fell slightly short of market expectations. We lift our 2023-25 revenue and profit estimates but keep outer year profitability assumptions. We raise our fair value estimate to USD 39.10 per ADS (HKD 151.90 per share) from USD 35.50 (HKD 136.00), which implies a forward 2024 price/sales ratio of 1.5 times and price/earnings of 34.1 times.

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