Li Auto Inc. (LI) shares are experiencing a rebound on Thursday, climbing back from the sharp losses they incurred after the company’s second-quarter earnings report was released on Wednesday. This recovery is fueled by a positive outlook from some analysts.
Ming Hsun Lee, an analyst at B of A Securities, maintained a Buy rating on Li Auto stock and raised the price target from $30 to $31. However, JP Morgan countered with a more conservative view, maintaining their Neutral rating and lowering their price target from $21 to $19.
Li Auto’s stock took a hit on Wednesday due to the company’s quarterly revenue falling short of analyst expectations. Additionally, adjusted income from operations declined by 57.4% year-over-year. This downturn was partly attributed to changes in product mix and pricing strategy, which also led to a decrease in vehicle margin by 230 basis points to 21%.
Despite the recent setbacks, Wall Street analysts hold an average 12-month price target of $25 for Li Auto. This suggests potential upside from current levels, with a high target of $31 and a low target of $19.
While the stock’s performance in the short term remains uncertain, it’s worth noting that Li Auto is down 44.52% year-to-date. This significant decline could potentially contribute to a future rebound. The market’s average annual return is approximately 10%, which further supports the argument for potential growth.
While it’s important to remember that stocks don’t move in a straight line, Li Auto’s performance and analyst forecasts suggest a potential for future upside. Investors looking for in-depth information about Li Auto can access a comprehensive overview on Benzinga Pro, which offers a free trial for those seeking more detailed insights.
