Li Auto Inc ADR

LI: XNAS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$68.70	Brlwj	Xbcnrrk

Strong Q2 Top Line for Li Auto, As Expected, but Cautious Outlook To Weigh on Share Price

Vincent Sun

Aug 16, 2022

Li Auto's solid second-quarter revenue exceeded the high end of company’s guidance by 24% and beat our estimate by 4%. As it reported vehicle delivery for the quarter last month, we don't view the revenue beat as a surprise to the market. Instead, we expect management’s cautious outlook for third-quarter vehicle delivery—which we attribute to the cannibalization of Li One from the launch of the new L9 SUV—to weigh on share price performance. We reduce our fair value estimate to USD 37 per ADS (HKD 144 per share) from USD 43.50 per ADS (HKD 170.50 per share). Our fair value implies a forward 2023 price/sales ratio of 2.5 times.

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