Looking for growth without the hefty price tag? Consider NASDAQ:LI.

Last update: Jan 29, 2025

LI AUTO INC - ADR (NASDAQ:LI) was identified as an affordable growth stock by our stock screener. NASDAQ:LI is showing great growth, but also scores well on profitability, solvency and liquidity. At the same time it seems to be priced reasonably. We'll explore this a bit deeper below.

Assessing Growth for NASDAQ:LI

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NASDAQ:LI has earned a 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.
The Revenue has grown by 42.25% in the past year. This is a very strong growth!
The Revenue has been growing by 135.72% on average over the past years. This is a very strong growth!
LI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.56% yearly.
The Revenue is expected to grow by 20.31% on average over the next years. This is a very strong growth

ChartMill's Evaluation of Valuation

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NASDAQ:LI has achieved a 6 out of 10:

Based on the Price/Earnings ratio, LI is valued a bit cheaper than 80.00% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.42, LI is valued a bit cheaper.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LI indicates a somewhat cheap valuation: LI is cheaper than 80.00% of the companies listed in the same industry.
LI's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.39.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of LI indicates a rather cheap valuation: LI is cheaper than 90.00% of the companies listed in the same industry.
LI's Price/Free Cash Flow ratio is rather cheap when compared to the industry. LI is cheaper than 92.50% of the companies in the same industry.
LI has a very decent profitability rating, which may justify a higher PE ratio.
LI's earnings are expected to grow with 18.06% in the coming years. This may justify a more expensive valuation.

Understanding NASDAQ:LI's Health

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:LI has earned a 5 out of 10:

The Debt to FCF ratio of LI is 0.39, which is an excellent value as it means it would take LI, only 0.39 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.39, LI belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
LI has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.13, LI is doing good in the industry, outperforming 75.00% of the companies in the same industry.
LI has a better Current ratio (1.76) than 65.00% of its industry peers.
Looking at the Quick ratio, with a value of 1.64, LI is in the better half of the industry, outperforming 77.50% of the companies in the same industry.

Profitability Examination for NASDAQ:LI

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:LI scores a 6 out of 10:

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

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

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

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.