Li Auto stock price will be in the spotlight this week as the company publishes its financial results. Its American shares were trading at $27.56 on Monday, down by almost 18% from its highest level this year, and by nearly 60% from its lowest level in 2024. Its market cap has risen to almost $30 billion.
Li Auto business has been growing
Li Auto, the giant Chinese EV company, has been growing fast in the past few years, helped by the growing demand for electric vehicles in the country. Its annual revenue has jumped from $40.8 million in 2019 to over $17.4 billion last year, a 43,400% surge.
This growth happened as the number of vehicles delivered per year jumped. It sold just 1,000 vehicles in 2019, which crossed the 500,000 level in 2024. This growth is strong considering that it sold 376,000.
Most importantly, unlike many EV companies in their growth phase, Li Auto’s business is growing profitably. Its annual profit in 2023 jumped to $1.6 billion.
Analysts are optimistic that Li Auto’s business continued growing in the fourth quarter as the number of deliveries jumped. Its delivery numbers revealed that it shipped over 158,600 vehicles in Q4, a 20% annualized increase. This jump was lower than its guidance of between 160,000 and 170,000.
The average estimate is that Li Auto’s revenue will be CNY 44.56 billion or $6.2 billion, a 6.7% annual increase. This figure will bring the annual revenue to 145.6 billion yuan or $20 billion. It will then grow by 31% in 2025 to over 192 billion yuan or $26 billion.
Read more: Li Auto stock price analysis: the bullish case for this Nio rival
Li is beating Tesla
Li Auto, which makes several brands like L9, L8, L7, L6, Li Mega, and Li i8, is doing better than Tesla, a company whose stock has imploded this year. Its delivery and revenue growth is doing much better because of the diverse selection of its brands and its popularity in China.
Li Auto also has higher gross margins than Tesla, a trend that may continue as it boosts its scale. Tesla has a gross margin of 17.8%, EBITDA margin of 13.3%, and a net income margin of 7.26%.
Li Auto has a gross margin of 21.4% and EBITDA and net income margins of 5.8% and 7.15%, respectively. These numbers mean that Li will likely pass Tesla in terms of profitability margins in the future as it boosts its scale.
Tesla’s business is struggling, with the market anticipating a big drop in first-quarter deliveries. Its European sales have dived, and analysts anticipate that the fallout from Musk’s role in DOGE will affect its American business.
Analysts are upbeat about the Li Auto stock price. The average estimate is that its shares will jump to $32.3, up from the current $27.56.
Read more: Li Auto stock price: here’s why this EV giant is about to surge
Li Auto stock price analysis
Li Auto share price chart by TradingView
The daily chart shows that the LI share price has been in a strong uptrend in the past few months. It has jumped from a low of $17.8 in 2024 to a high of $27.56.
The stock has made a golden cross pattern as the 50-day and 200-day moving averages have crossed each other. This pattern is one of the most bullish patterns in the market.
The Li Auto stock price has formed a cup and handle pattern, a popular bullish continuation sign. Therefore, the stock will likely have a bullish breakout, with the next point to watch being $35.60, the 61.8% Fibonacci Retracement point, which is about 30% above the current level.
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