Revised Delivery Outlook Pressures Volatile EV Stock

LI looks ripe for a round of bear notes

Digital Content Manager
Mar 21, 2024 at 9:59 AM
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China-based Li Auto Inc (NASDAQ:LI) announced earlier it expects electric vehicle (EV) deliveries to come around 78,000 vehicles for the first quarter, as opposed to the 103,000 it previously anticipated, due to lower-than-expected order intake. The security is down 7.3% at $31.63 this morning.

Li Auto stock has suffered several bear gaps in the past month that have place it below the 20-day moving average, a trendline that had been acting as support earlier this month. Overhead pressure at the $47 level turned away the equity's February rally, after rejecting an August surge that came just shy of record highs. So far this month, LI has shed 30.2%.

Despite its recent price action, all nine analysts in coverage rate the stock a "buy" or better, while the 12-month consensus target price of $57.09 is still a whopping 77.6% premium to current levels. This indicates there is ample room for downgrades and/or price-target cuts, which could pressure LI.

Short-term options traders lean bearish. This is per the security's Schaeffer's put/call open interest ratio (SOIR) of 1.10 that sits higher than 74% of readings from the past 12 months.

 

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