LI - Buy Li Auto's Dip - Electrification Is Here To Stay
2024-03-31 09:00:00 ET
Summary
- The market has over-reacted to LI's lowered FQ1'24 delivery guidance, since it is mostly attributed to the seasonally weak Chinese New Year, with Q2 likely to bring forth improved numbers.
- If anything, the same has been reported by multiple automakers, with LI better off not participating in the margin dilutive price wars.
- Based on the management's focus on first/ second tier cities, we believe that the automaker remains well positioned to grow profitably ahead, further expanding its balance sheet health.
- With LI still offering an impressive upside potential over the next few years, we believe that the recent pullback is a gift for opportunistic investors looking to dollar cost average.
We previously covered Li Auto (NASDAQ: LI ) in December 2023, discussing why it remained a Buy, with its hybrid offerings competently bridging the gap between ICE and EV demand in China....
Buy Li Auto's Dip - Electrification Is Here To Stay