LI Earnings: Li Auto Races Ahead on Impressive Q4 Performance
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LI Earnings: Li Auto Races Ahead on Impressive Q4 Performance

Story Highlights

Li Auto’s Q4 vehicle deliveries jumped by nearly 185%. The Chinese EV maker expects another strong sales print for the first quarter.

Li Auto (NASDAQ:LI) shares jumped by nearly 8% in the early session today after the Chinese EV maker reported robust fourth-quarter numbers. Revenue soared by 136.4% year-over-year to $5.88 billion, smashing estimates by $360 million. Further, earnings per American Depository Share (EPADS) of $0.60 surpassed expectations by $0.16.

In Q4, LI’s vehicle deliveries increased by 184.6% year-over-year to 131,805 units. Similarly, its vehicle deliveries for the full year jumped by 182.2% to 376,030 units. This rise in vehicle sales was accompanied by an expansion of 270 basis points in the company’s vehicle margin to 22.7%.

Further, LI’s fourth-quarter gross profit expanded by 174.4% to $1.38 billion. Notably, the company’s free cash flow generation ballooned by 349.4% to $2.06 billion during the quarter. Li Auto delivered this performance despite the fierce competition in the Chinese EV market. The company had a total cash pile of $14.6 billion at the end of December 2023.

For the upcoming quarter, Li Auto expects vehicle deliveries in the range of 100,000 to 103,000. This points to a robust year-over-year jump of 90.2% to 95.9%. Total revenue for the quarter is seen landing between $4.40 billion and $4.53 billion.

Is LI Stock a Good Investment?

While the Shanghai Composite Index (SHCOMP) has declined by ~9% over the past year, Li Auto’s share price has ticked higher by nearly 44%. Overall, the Street has a Strong Buy consensus rating on Li Auto, and the average LI price target of $52.30 points to a further 50.3% potential upside in the stock. However, analysts’ views on the stock could see a revision following today’s earnings report.

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