NASDAQ:LI, a strong growth stock, setting up for a breakout.

Last update: Dec 9, 2024

Growth investors are on the lookout for stocks displaying robust revenue and EPS growth. In this analysis, we'll assess whether LI AUTO INC - ADR (NASDAQ:LI) aligns with growth investing criteria, especially as it consolidates and signals a possible breakout. As always, investors should conduct their own research, but LI AUTO INC - ADR has surfaced on our radar for growth with base formation, warranting further examination.

Assessing Growth for NASDAQ:LI

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:LI was assigned a score of 8 for growth:

The Earnings Per Share has grown by an impressive 59.18% over the past year.
LI shows a strong growth in Revenue. In the last year, the Revenue has grown by 42.25%.
Measured over the past years, LI shows a very strong growth in Revenue. The Revenue has been growing by 135.72% on average per year.
The Earnings Per Share is expected to grow by 8.57% on average over the next years. This is quite good.
Based on estimates for the next years, LI will show a very strong growth in Revenue. The Revenue will grow by 20.31% on average per year.

A Closer Look at Health for NASDAQ:LI

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NASDAQ:LI has earned a 6 out of 10:

LI has a better Altman-Z score (2.73) than 85.71% of its industry peers.
The Debt to FCF ratio of LI is 1.05, which is an excellent value as it means it would take LI, only 1.05 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 1.05, LI belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
LI has a Debt/Equity ratio of 0.44. This is a healthy value indicating a solid balance between debt and equity.
LI has a better Current ratio (1.76) than 61.90% of its industry peers.
LI has a Quick ratio of 1.63. This is in the better half of the industry: LI outperforms 76.19% of its industry peers.

Profitability Examination for NASDAQ:LI

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:LI has earned a 6 out of 10:

LI has a better Return On Assets (7.01%) than 90.48% of its industry peers.
LI has a Return On Equity of 16.18%. This is amongst the best in the industry. LI outperforms 85.71% of its industry peers.
LI has a better Return On Invested Capital (4.08%) than 71.43% of its industry peers.
Looking at the Profit Margin, with a value of 7.61%, LI belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
LI has a better Operating Margin (3.93%) than 73.81% of its industry peers.
LI has a better Gross Margin (21.61%) than 83.33% of its industry peers.
LI's Gross Margin has improved in the last couple of years.

Looking at the Setup

ChartMill incorporates a Setup Rating in its analysis, which measures the extent of consolidation in a stock over recent days and weeks. This rating, ranging from 0 to 10, is updated daily and takes into account multiple short-term technical indicators. The current setup rating for NASDAQ:LI is 7:

Although the technical rating is bad, LI does present a nice setup opportunity. We see reduced volatility while prices have been consolidating in the most recent period. There is a support zone below the current price at 22.28, a Stop Loss order could be placed below this zone.

Every day, new Strong Growth stocks can be found on ChartMill in our Strong Growth screener.

Check the latest full fundamental report of LI for a complete fundamental analysis.

Our latest full technical report of LI contains the most current technical analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.