Li Auto Critics Can’t Argue with the Delivery Numbers

Suffice it to say that there’s a whole lot going on with Beijing, China-based electric vehicle manufacturer Li Auto (NASDAQ:LI). Even as LI stock wiggles and wobbles around, there’s a slew of developments to keep the stakeholders’ spirits up.

A front view of the Li Xiang One SUV from Li Auto (LI).
Source: Carrie Fereday /

Where to begin? For one thing, Li Auto just disclosed another record-setting month of vehicle deliveries.

Moreover, the company’s quarterly revenues indicate solid growth. As a result, the analyst community is preparing for robust full-year revenues.

In case all of that isn’t enough for you, Li Auto is also reportedly about to get listed on a major exchange – and raise a boatload of money in the process.

A Closer Look at LI Stock

Excitement was in the air back in November 2020 when LI stock was touching a 52-week high of $47.70.

Since then, the buyers have backed off and allowed the share price to come down. They even let the stock hit a floor of $17 in May of this year.

That turned out to be a bargain price, as LI stock has recovered to $30 in early August.

Given the prior high point, the bulls should consider $50 to be their long-term target.

And in the short term, $35 is a good level to watch because the bulls were recently rejected at that price several times.

One concern is that Li Auto has trailing 12-month earnings per share of -22 cents. The good news is that this is very close to break-even.

So, hopefully the company can achieve positive per-share earnings in the near future.

Surging Delivery Figures, and More

The naysayers can argue all day long, but they have no verbal ammunition when it comes to Li Auto’s vehicle delivery numbers.

Going back to June, we can observe that Li Auto delivered 7,713 Li ONE models, a new monthly record for the automaker.

That number represented a whopping 321% year-over-year increase. Yet, the company’s stock shares fell 5.8% on the day of the monthly record announcement.

I tell you, the market can be irrational sometimes.

Fast-forward to July, and Li Auto delivered 8,589 for yet another monthly company record.

This was also an increase of 251% year-over-year, and the first time the automaker passed the 8,000-vehicle monthly delivery mark.

I ask myself: What more do you people want?

OK, fine, I’ll give you even more good news. Reportedly, Li Auto’s most recent quarterly results show that the company took in revenues of 3.6 billion CNY (Chinese yuan renminbi), thus beating expectations by 9.3%.

And perhaps with that in mind, 15 analysts covering Li Auto are predicting revenues of 21.1 billion CNY for 2021. So clearly, there’s a general feeling of optimism among the experts watching the company.

Welcome to Hong Kong

I can tell that you’re still not motivated to buy LI stock yet. No worries – there’s more good news to report.

Or at least, it’s potentially good news. Apparently, Li Auto is looking to commence an initial public offering in Hong Kong.

It’s been stated that the company is seeking to raise a whopping $1.52 billion in its Hong Kong dual primary listing, at a per-share price of 118 HKD (Hong Kong dollars).

Li Auto is said to be selling 100 million shares in the deal, but it could be more than that.

Evidently, the company has the option to sell an additional 15 million shares, potentially raising an extra $227.5 million in the process. Hence, the total size of the deal could extend to $1.74 billion.

All of this could add up to a massive capital infusion for Li Auto, along with the company’s introduction to legions of eager market traders.

The Bottom Line

There you have it: a cram session on Li Auto’s raft of exciting recent developments.

Along the way, we’ve observed that the market’s response hasn’t always been rational.

As a result, LI stock still has a way to go before approaching $50 again. That shouldn’t be a problem at all, though, for anyone considering taking a long position now.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

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