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Up 64% in the Past Month, Will Li Auto Continue to Rally?

Published 06/18/2021, 12:58 PM
Updated 06/18/2021, 01:30 PM
© Reuters.  Up 64% in the Past Month, Will Li Auto Continue to Rally?

Chinese EV-maker Li Auto (LI) garnered significant investor attention over the past month launching 2021 Li ONE in May 2021. The stock has soared 63.8% over this period. However, can it keep rallying despite the global semiconductor shortage? Let’s find out.Shares of Chinese EV-maker Li Auto Inc. (LI) have rallied 63.8% over the past month to close yesterday’s trading session at $30.88. This price surge can be primarily attributed to investors’ interest surrounding the company’s launch of 2021 Li ONE on May 25, 2021, which features enhanced upgrades, including an enhanced NEDC range of 1,080 kilometers. However, LI continues to face intense competition from other Chinese EV makers such as XPeng Inc. (XPEV) and NIO Inc. (NIO).

It is currently trading 35.3% below its all-time high of $47.70 which it hit on November 24, 2020. The company delivered 4,323 Li ONEs in May 2021 compared to 5,539 in April 2021. LI’s total revenue declined 13.8% sequentially to $545.68 million for the first quarter ended March 31, 2021. Also, its net loss for the quarter increased 54% year-over-year to $54.94 million. Moreover, the company’s production continues to be impacted by the global semiconductor shortage. So, LI’s near-term prospects look bleak.

Here’s what I think could shape LI’s performance in the near term:

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