What Can We Learn From Li Auto Inc. (LI)’s Valuation Ratios?


Li Auto Inc. (NASDAQ:LI) finished Thursday with an addition of $1.13 to close at $24.23, an upside of 4.89 percent. An average of 10,396,880 shares of common stock have been traded in the last five days. There was a fall of -$1.58 in the past week, and it reached a new high 14 times over the past 12 months. The last 20 days have seen an average of 8,797,120 shares traded, while the 50-day average volume stands at 9,262,820.

LI stock has decreased by -17.47% in the last month. The company shares reached their 1-month lowest point of $22.90 on 09/21/22. With the stock rallying to its 52-week high on 06/24/22, shares of the company touched a low of $16.86 and a high of $41.49 in 52 weeks. It has reached a new high 6 times so far this year and lost -24.52% or -$7.87 in price. In spite of this, the price is down -41.60% from the 52-week high.

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Valuation Metrics

Li Auto Inc. (LI) has a trailing price-to-sales (P/S) ratio at 5.28, the price-to-book (PB) ratio at 3.86, and the price-to-cash flow ratio at 21.60.

Financial Health

The quick ratio of Li Auto Inc. for the three months ended June 29 was 3.10, and the current ratio was 3.20, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 0.19 and a total debt to equity ratio of 0.32 for the quarter ending June 29. Li Auto Inc.’s EBITDA margin for the year ending June 29 is -1.58%, while its operating margin for the same period stands at -4.00%. Its gross profit as reported stood at $904.1 million compared to revenue of $4.24 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Li Auto Inc.’s return on assets was -0.50%.

Earnings Surprise

For the three-month period that ended June 29, Li Auto Inc. had $935.4 million in total debt. The analyst consensus anticipated Li Auto Inc.’s latest quarter earnings to come in at -$0.06 per share, but it turned out to be -$0.09, a -50.00% surprise.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Li Auto Inc. (LI) price momentum. RSI 9-day as of the close on 22 September was 35.87%, suggesting the stock is Neutral, with historical volatility in this time frame at 72.51%.

As of today, LI’s price is $24.40 -6.12% or -$1.58 from its 5-day moving average. LI is currently trading -18.42% lower than its 20-day SMA and +8.02% higher than its 100-day SMA. However, the stock’s current price level is -36.29% below the SMA50 and -20.58% below the SMA200.

The stochastic %K and %D were 19.11% and 19.41%, respectively, and the average true range (ATR) was 1.66. With the 14-day stochastic at 25.75% and the average true range at 1.66, the RSI (14) stands at 34.94%. The stock has reached -1.04 on the 9-day MACD Oscillator while the 14-day reading was at -1.45.

Analyst Ratings

CLSA launched coverage on Li Auto Inc. (NASDAQ: LI) in its analyst report released on August 08, 2022. The firm assigned the stock a Buy rating. The consensus rating for Li Auto Inc. (LI) among analysts is Buy. According to current brokerage recommendations, 0 brokerage firms advise that investors sell LI, while 3 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 4 analysts, while 27 others rate it as a “buy”.

What is LI’s price target for the next 12 months?

Analysts predict a range of price targets between $109.59 and $419.31, with a median target of $267.14. Taking a look at these predictions, the average price target given by analysts for Li Auto Inc. (LI) stock is $256.39.


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