NASDAQ:LI—A High-Growth Stock Gearing Up for Its Next Upward Move.

Last update: Jan 6, 2025

Groth investors are looking for stocks showing high revenue and EPS growth. We will have a look here to see if LI AUTO INC - ADR (NASDAQ:LI) is suited for growth investing, while it is forming a base and may be ready to breakout. Investors should of course do their own research, but we spotted LI AUTO INC - ADR showing up in our growth with base formation screen, so it may be worth spending some more time on it.

Assessing Growth Metrics 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:

LI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 59.14%, which is quite impressive.
Looking at the last year, LI shows a very strong growth in Revenue. The Revenue has grown by 42.25%.
The Revenue has been growing by 135.72% on average over the past years. This is a very strong growth!
Based on estimates for the next years, LI will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.56% on average per year.
LI is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 20.31% yearly.

A Closer Look at Health for NASDAQ:LI

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:LI, the assigned 5 reflects its health status:

LI has a debt to FCF ratio of 0.39. This is a very positive value and a sign of high solvency as it would only need 0.39 years to pay back of all of its debts.
LI has a Debt to FCF ratio of 0.39. This is amongst the best in the industry. LI outperforms 100.00% of its industry peers.
LI has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of LI (0.13) is better than 72.50% of its industry peers.
LI's Current ratio of 1.76 is fine compared to the rest of the industry. LI outperforms 65.00% of its industry peers.
The Quick ratio of LI (1.64) is better than 77.50% of its industry peers.

Looking at the Profitability

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:

With an excellent Return On Assets value of 6.57%, LI belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
LI has a better Return On Equity (15.27%) than 82.50% of its industry peers.
LI has a Return On Invested Capital of 5.78%. This is in the better half of the industry: LI outperforms 80.00% of its industry peers.
Looking at the Profit Margin, with a value of 7.16%, LI belongs to the top of the industry, outperforming 85.00% of the companies in the same industry.
The Operating Margin of LI (4.48%) is better than 77.50% of its industry peers.
LI has a better Gross Margin (21.47%) than 80.00% of its industry peers.
LI's Gross Margin has improved in the last couple of years.

How do we evaluate the setup for NASDAQ:LI?

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 only medium, LI does present a nice setup opportunity. Prices have been consolidating lately. A pullback is taking place, which may present a nice opportunity for an entry. There is a support zone below the current price at 24.33, a Stop Loss order could be placed below this zone. We notice that large players showed an interest for LI in the last couple of days, which is a good sign.

Our Strong Growth screener lists more Strong Growth stocks and is updated daily.

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

For an up to date full technical analysis you can check the technical report of LI

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.