UPDATE: US Tiger Securities Starts Li Auto (LI) at Buy
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US Tiger Securities analyst Bo Pei initiates coverage on Li Auto (NASDAQ: LI) with a Buy rating and a price target of $40.00.
The analyst comments "Unlike NIO and XPEV, LI currently only offers one model, Li ONE, an EREV (extended-range electric vehicle) that combines the advantages of traditional ICEVs and BEVs. We believe EREVs offer an attractive value proposition to buyers who hesitate to buy EVs due to underdeveloped charging infrastructure but also want to enjoy the benefits of driving EVs, which should help LI obtain a reasonable market share. Medium term, we see deliveries growing at over 70% in '22, driven by Li ONE and the expected launch of X01 in 3Q:22. In addition, LI plans to launch two BEV models in 2023, which we feel confident given the strong R&D capability proven by the success of Li ONE. Longer term, LI plans have 10-15 models by '25
with each achieving a similar success of Li ONE, an aggressive yet possible target. LI is currently trading at 2.1x '23E sales, a meaningful discount to BEV peers, but the gap could be narrowed as LI launches BEV models."
Shares of Li Auto closed at $30.94 yesterday.
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