Chinese EV Makers Struggle but Li Auto Reports a Profit

Shares of China’s hybrid electric-vehicle maker Li Auto (LI) have more than doubled in price since falling to a record low last October, and the company is emerging as the leader among China’s electric vehicle (EV) makers.  Li Auto unexpectedly reported profits for the past two quarters as it keeps releasing new models and is making money while other Chinese EV makers flounder.

Many analysts remain bullish on the outlook for Li Auto.   Citigroup projects that shares of Li Auto will rally another +88% this year, and Morgan Stanley raised its price target for the stock by more than +40% this month.  Analysts have raised their 12-month target price for the company by about 10% over the past month alone.  Li Auto has outperformed its peers by introducing a new model in each quarter since the middle of last year, which is a faster pace than competitors such as XPeng (XPEV) and Nio Inc (NIO).