Li Auto stock was rising after delivering the kind of earnings that Tesla and other electric-vehicle peers needed. Growth was better than expected and more growth is coming.
Li Auto
reported on Monday fourth-quarter earnings per American depositary receipt of 60 cents from sales of $5.8 billion. Wall Street was looking for about 44 cents and $5.5 billion, respectively, according to FactSet. A year ago, earnings per ADS were 4 cents from sales of $2.5 billion.
Each ADR represents two Li Auto shares.
Li Auto’s fourth-quarter operating margin was 7.3% compared with roughly break-even results a year ago.
“Undeterred by the fiercely competitive NEV market in 2023, Li Auto achieved an outstanding performance with its three Li L series models,” said CEO Xiang Li in a news release. “With our significantly increasing scale, continued R&D advancement, and consistently improving operating efficiency throughout the year, 2023 marks our best financial performance yet, setting a solid foundation for Li Auto’s growth to diversify its product matrix and cater to a broader range of user needs in 2024.”
Looking ahead, the car company expects to deliver about 100,000 to 103,000 vehicles in the first quarter. That’s up from about 53,000 delivered in the first quarter of 2023. It also implies deliveries of about 35,000 a month in both February and March. Li Auto delivered 31,165 vehicles in January.
The guidance looked solid. Citi analyst Jeff Chung wrote Monday that investors were expecting about 85,000 to 90,000 deliveries for the first quarter.
U.S.-listed ADRs of Li Auto were up 12% in premarket trading to $38.99.
S&P 500
and
Nasdaq Composite
futures were flat.
Coming into Monday trading, Li Auto’s ADRs have fallen about 16% over the past three months.
Tesla
shares declined about 18% over the same span.
NIO
and
XPeng
shares dropped 27% and 53%, respectively.
Investors have been worried about rising EV competition amid slowing demand growth. Li Auto’s quarter showed things might be a little better than feared.
NIO and XPeng shares were up about 2.4% and 3.6% in premarket trading, respectively, Tesla shares, however, weren’t getting a bump. Tesla stock fell about 0.2% in premarket trading.
China is the world’s largest market for new cars and new EVs. Tesla generated about 22% of its 2023 sales in China.
Write to Al Root at [email protected]
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