Li Auto Gains 2% on Q4 Beat & Positive Guidance

Chinese electric vehicle (EV) maker Li Auto Inc. (LI) posted better-than-expected fourth-quarter results pushing the shares up 1.9% to close at $27.89 on February 25.

Li Auto operates in the premium smart EV market and to date sells only one model, Li ONE, which is a six-seater, large premium smart electric SUV. The LI stock has lost 13.8% year-to-date, against gaining 7.9% over the past year.

Better-than-expected Q4 Results

Li reported revenues of $1.67 billion, outpacing the consensus estimate of $1.4 billion. Out of the total, vehicles sales for Q4 stood at $1.63 billion. On an RMB basis, its revenues jumped a whopping 156.1% compared to the prior-year period.

Similarly, Li’s Q4 adjusted earnings of $0.05 per share came in better than analysts’ estimated loss of $0.04 per share. On an RMB basis, its adjusted EPS jumped a whopping 467% to RMB 0.34 compared to the prior-year quarter.

For FY21, revenues advanced to $4.24 billion and adjusted earnings stood at $0.06 per share. Vehicle sales for FY21 stood at $4.10 billion.

Delivery Update

In Q4, Li Auto delivered a total of 35,221 Li ONE vehicles, growing 143.5% year-over-year.

Meanwhile, in FY21, Li Auto delivered a total of 90,491 Li ONE autos, growing 177.4% compared to FY20.

In January 2022, delivered a total of 12,268 Li ONEs, growing 128.1% year-over-year.

CFO Comments

The CFO of Li Auto, Tie Li, said, “Our robust performance in the fourth quarter of 2021 capped a remarkable year of growth for Li Auto.”

“Driven by an impressive number of vehicle deliveries, we achieved revenues of RMB10.6 billion for the fourth quarter and RMB27.0 billion for the full year of 2021, up 156.1% and 185.6% year over year, respectively. Our vehicle margin in the fourth quarter increased to 22.3% and full-year vehicle margin came in at 20.6%, boosted by our outstanding operating efficiency in manufacturing and supply chain management,” Li added.

Q1FY22 Guidance

Based on current business momentum, Li expects to deliver between 30,000 and 32000 vehicles in the first quarter of fiscal 2022, implying growth of 138.5% to 154.4% year-over-year.

Moreover, for Q1, Li forecasts total revenue to fall in the range of $1.39 billion to $1.48 billion ahead of consensus estimates of $1.40 billion.  

Stock Prediction

With 8 unanimous Buys, the LI stock commands a Strong Buy consensus rating. The Li Auto stock prediction of $48.57 implies 74.2% upside potential to current levels.

Hedge Funds

TipRanks’ Hedge Fund Trading Activity tool shows that confidence in Li Auto is currently Very Positive, as 4 hedge funds increased their cumulative holdings of the LI stock by 7.5M shares in the last quarter.

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