why Li Auto Inc. [LI] is a Good Choice for Investors After New Price Target of $40.30


Li Auto Inc. [NASDAQ: LI] traded at a low on 05/03/22, posting a -1.71 loss after which it closed the day’ session at $22.93. The company report on May 1, 2022 that Li Auto Inc. April 2022 Delivery Update.

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Li Auto Inc. (“Li Auto” or the “Company”) (Nasdaq: LI; HKEX: 2015), a leader in China’s new energy vehicle market, today announced that the Company delivered 4,167 Li ONEs in April 2022. Cumulative deliveries of Li ONE have reached 159,971 since the vehicle’s market debut in 2019.

“The COVID-19 resurgence in the Yangtze Delta region continues to cause severe industry-wide disruptions in supply chain, logistics and production since late March. Our Changzhou manufacturing base is located in the center of the Yangtze Delta region, which is home to over 80% of our parts suppliers, especially in Shanghai and Kunshan. The COVID-19 resurgence in this area has incapacitated some suppliers in Shanghai and Kunshan. Some of them completely shut down production or delivery of their products, making it impossible for us to maintain production after exhausting our parts inventory. This materially affected our production in April, resulting in delayed deliveries for some of our users. At present, we are working with our supply chain partners to restore production capacity, aiming to shorten the delivery waiting time for Li ONE users, while meeting all pandemic prevention and containment requirements,” Yanan Shen, co-founder and president of Li Auto, commented.

The results of the trading session contributed to over 4179524 shares changing hands. Over the past one week, the price volatility of Li Auto Inc. stands at 7.08% while the volatility over the past one month is 6.05%.

The market cap for LI stock reached $23.94 billion, with 949.11 million shares outstanding and 163.08 million shares in the current float. Compared to the average trading volume of 10.05M shares, LI reached a trading volume of 4179524 in the most recent trading day, which is why market watchdogs consider the stock to be active.

What do top market gurus say about Li Auto Inc. [LI]?

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for LI shares is $40.30 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on LI stock is a recommendation set at 1.80. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

HSBC Securities have made an estimate for Li Auto Inc. shares, keeping their opinion on the stock as Buy, with their previous recommendation back on April 04, 2022. While these analysts kept the previous recommendation, China Renaissance raised their target price to Buy. The new note on the price target was released on March 24, 2022, representing the official price target for Li Auto Inc. stock. Previously, the target price had yet another raise to $38, while Barclays analysts kept a Overweight rating on LI stock.

The Average True Range (ATR) for Li Auto Inc. is set at 1.62, with the Price to Sales ratio for LI stock in the period of the last 12 months amounting to 5.87. The Price to Book ratio for the last quarter was 3.51, with the Price to Cash per share for the same quarter was set at 6.87.

How has LI stock performed recently?

Li Auto Inc. [LI] gain into the green zone at the end of the last week, gaining into a positive trend and gaining by 8.42. With this latest performance, LI shares dropped by -15.82% in over the last four-week period, additionally sinking by -29.10% over the last 6 months – not to mention a rise of 18.07% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for LI stock in for the last two-week period is set at 43.20, with the RSI for the last a single of trading hit 43.51, and the three-weeks RSI is set at 44.01 for Li Auto Inc. [LI]. The present Moving Average for the last 50 days of trading for this stock 25.63, while it was recorded at 22.60 for the last single week of trading, and 28.83 for the last 200 days.

Li Auto Inc. [LI]: Deeper insight into the fundamentals

Operating Margin for any stock indicates how profitable investing would be, and Li Auto Inc. [LI] shares currently have an operating margin of -3.77 and a Gross Margin at +20.82. Li Auto Inc.’s Net Margin is presently recorded at -1.19.

Return on Total Capital for LI is now -2.44, given the latest momentum, and Return on Invested Capital for the company is -0.80. Return on Equity for this stock declined to -0.91, with Return on Assets sitting at -0.65. When it comes to the capital structure of this company, Li Auto Inc. [LI] has a Total Debt to Total Equity ratio set at 24.66. Additionally, LI Total Debt to Total Capital is recorded at 19.78, with Total Debt to Total Assets ending up at 16.37. Long-Term Debt to Equity for the company is recorded at 17.85, with the Long-Term Debt to Total Capital now at 14.32.

Reflecting on the efficiency of the workforce at the company, Li Auto Inc. [LI] managed to generate an average of -$32,554 per employee. Receivables Turnover for the company is 123.69 with a Total Asset Turnover recorded at a value of 0.55.Li Auto Inc.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 4.20 and a Current Ratio set at 4.30.

Insider trade positions for Li Auto Inc. [LI]

There are presently around $5,155 million, or 27.60% of LI stock, in the hands of institutional investors. The top three institutional holders of LI stocks are: BLACKROCK INC. with ownership of 28,842,854, which is approximately 6.861% of the company’s market cap and around 0.32% of the total institutional ownership; VANGUARD GROUP INC, holding 15,006,242 shares of the stock with an approximate value of $350.1 million in LI stocks shares; and BAILLIE GIFFORD & CO, currently with $341.42 million in LI stock with ownership of nearly -1.096% of the company’s market capitalization.

Positions in Li Auto Inc. stocks held by institutional investors increased at the end of May and at the time of the May reporting period, where 149 institutional holders increased their position in Li Auto Inc. [NASDAQ:LI] by around 59,245,324 shares. Additionally, 105 investors decreased positions by around 16,940,655 shares, while 48 investors held positions by with 144,767,526 shares. The mentioned changes placed institutional holdings at 220,953,505 shares, according to the latest SEC report filing. LI stock had 56 new institutional investments in for a total of 16,826,802 shares, while 34 institutional investors sold positions of 5,412,358 shares during the same period.