Li Auto Inc. Sponsored ADR (LI) Is a Trending Stock: Facts to Know Before Betting on It

Core Viewpoint - Li Auto Inc. has shown a significant stock performance with an 18.4% return over the past month, contrasting with the S&P 500's -0.3% change, indicating potential investor interest and market dynamics affecting the stock's future performance [1] Earnings Estimates - Li Auto is expected to report earnings of $0.05 per share for the current quarter, reflecting a year-over-year decline of 90.4% [4] - The consensus earnings estimate for the current fiscal year stands at $0.14, indicating a decrease of 89.9% from the previous year, with no changes in estimates over the last 30 days [4] - For the next fiscal year, the consensus earnings estimate is $0.51, suggesting a substantial increase of 267.1% compared to the prior year, with estimates remaining unchanged [5] Revenue Projections - The consensus sales estimate for the current quarter is $4.24 billion, representing a year-over-year decline of 30.2% [10] - For the current fiscal year, the revenue estimates are $16.2 billion, indicating a decrease of 19.4%, while the next fiscal year's estimate of $19.57 billion reflects an increase of 20.8% [10] Recent Performance and Surprises - In the last reported quarter, Li Auto generated revenues of $3.84 billion, down 37.1% year-over-year, with an EPS of -$0.09 compared to $0.52 a year ago [11] - The reported revenues exceeded the Zacks Consensus Estimate of $3.76 billion by 2.32%, while the EPS fell short by 325% [11] - Over the last four quarters, Li Auto has surpassed consensus EPS estimates three times and revenue estimates twice [12] Valuation Metrics - Li Auto's valuation is assessed using various multiples, including price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to determine if the stock is fairly valued [13][14] - The Zacks Value Style Score for Li Auto is graded as C, indicating that the stock is trading at par with its peers [16] Conclusion - The current analysis suggests that while there is market buzz around Li Auto, the Zacks Rank of 4 indicates potential underperformance relative to the broader market in the near term [17]