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Li Auto Inc.

Data period: Annual Quarterly Graham uses annual
NASDAQ · Consumer Cyclical
Li Auto Inc.
LI · Auto Manufacturers
$13.21
▼ -0.37 (-2.72%)
Cached · 10 min
Overall Grade
C
Defensive
D
Enterprising
Profitability
F⤢
Gross Profit Margin 7.9%
Operating Margin -13.0%
Net Income Margin -10.0%
Fin. Health
C⤢
Years to Pay Off Debt -7.7 yrs
Working Capital vs Long-Term Debt $45.6B
Working Capital $49.4B
Valuation
A⤢
Price-to-Book 0.16x
Cash Flow
A⤢
Free Cash Flow $3.5B
Defensive — Graham's strict criteria (P/B, P/E, dividends, stability)  ·  Enterprising — Profitability & cash flow focused, accepts higher valuations for quality
About Li Auto Inc.
Li Auto Inc. operates in the energy vehicle market in the People's Republic of China. The company designs, develops, manufactures, and sells premium smart electric vehicles. Its product line comprises multi-purpose vehicles and sport utility vehicles. The company offers sales and after sales management, and technology development and corporate management services, as well as manufacturing equipment. It offers its products through online and offline channels. The company was formerly known as Leading Ideal Inc. and changed its name to Li Auto Inc. in July 2020. Li Auto Inc. was founded in 2015 and is headquartered in Beijing, the People's Republic of China.
Metric Explanations
What each dimension measures and where the thresholds come from.
Gross Profit Margin
Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.
Operating Margin
Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.
Net Income Margin
Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.
Years to Pay Off Debt
Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.
Working Capital vs Long-Term Debt
Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.
Working Capital
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Price-to-Book
Market price vs book value per share. Rarely below 1.5x for quality businesses today. Intangible assets (brand, software, patents) don't appear on the balance sheet under accounting rules, making P/B artificially high for asset-light companies like software and consumer brands.
Free Cash Flow
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
Market Data
Market Cap $13.3B
Enterprise Value -$60.6B
P/E (TTM) 12.83
Dividend Yield N/A
Exchange NASDAQ
Key Margins
Gross Profit 7.9%
Operating Margin -13.0%
Net Margin -10.0%
Company Info
Sector Consumer Cyclical
Industry Auto Manufacturers
Employees 30728
Country China
Visit website
Showing Key Metrics
Income Highlights
Metric Q1 2026 Q4 2025
Gross Profit % 7.9%▼ 17.8%
Operating Margin % -13.0%▼ -1.5%
Net Income % -10.0%▼ 0.0%
Diluted EPS -2.26▼ 0.00
Balance Sheet Highlights
Metric Q1 2026 Q4 2025 Q4 2024
Total Assets $144.6B $154.3B N/A
Total Debt $17.7B▼ $17.8B• N/A
Working Capital $49.4B▼ $51.7B• N/A
Years to Pay Debt -7.75 2,732.75 N/A
Cash Flow Highlights
Metric Q1 2026 Q4 2025
Free Cash Flow $3.5B▲ -$5.0B
Owner Earnings N/A N/A
CapEx % of Net Income N/A N/A
📊 Quarterly mode — Graham Fair Value & 7 Criteria require annual data. Switch to Annual for full analysis.
Quarter vs Same Quarter Last Year
YoY strips seasonality
Revenue Growth (YoY)
Prior year: $25.9B ▼ $23.0B -11.4%
Revenue growth vs same quarter last year strips seasonality. Consistent double-digit growth is a Buffett hallmark.
Gross Margin
Prior year: 20.5% ▼ 7.9% -12.6pp
Buffett: consistent gross margin above 40% signals durable pricing power and competitive moat.
Operating Margin
Prior year: -11.6% ▼ -13.0% -1.5pp
Graham: operating margin reflects true business economics before financing. Trend matters as much as level.
Net Margin
Prior year: 2.5% ▼ -10.0% -12.5pp
Net margin can be distorted by one-time items, tax timing, or interest costs — compare to operating margin for signal quality.
Quarterly Health Checks
3 Graham/Buffett criteria that are valid and reliable on quarterly data
✅ Adequate Size
Graham required scale for resilience. Quarterly revenue × 4 gives an annualised proxy.
$23.0B/qtr (≈$91.9B ann.)
vs > $1.5B annualised revenue
❌ Financial Condition
Current assets vs current liabilities — a real-time liquidity snapshot. Valid and reliable on quarterly data.
1.88x current ratio
vs ≥ 2.0x
✅ Free Cash Flow
Buffett's most important single metric. A positive FCF quarter means the business generated real cash for owners after maintaining its asset base.
$3.5B
vs Positive
Operating Cash Flow
$3.5B
Latest quarter · Buffett's cash reality check
ROIC
-2.7%
Based on latest annual operating income
Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.
Market Cap / Net Assets
0.2x
Net Assets: $70.6B
Asset Context — Auto Manufacturers
Asset-heavy businesses (energy, industrials, utilities, REITs) have physical assets with real replacement value — book value and Net Assets are more meaningful here than for technology or consumer brand companies. A low Market Cap / Net Assets ratio may indicate genuine undervaluation.
⚠️ Net margin compressed 12.5pp vs same quarter last year. Common causes: one-time charges (restructuring, write-downs, legal settlements), tax rate changes, or rising interest expense. Check the income statement notes before drawing conclusions about operating health.
Peers & Industry Comparison
Auto Manufacturers — Auto-detected peers
Company Price Market Cap P/E Gross Margin Net Margin Revenue
LI $13.21 $13.3B 12.83 7.9% -10.0% $23.0B
TSLA
Tesla, Inc.		 $400.49 $1,504.1B 367.4 19.1% 3.9% $97.9B
F
Ford Motor Company		 $14.06 $56.0B N/A 7.1% -3.2% $189.9B
GM
General Motors Company		 $79.29 $71.5B 28.9 11.1% 1.4% $184.6B
TM
Toyota Motor Corporation		 $173.94 $206.0B 9.4 16.7% 7.6% $50,685.0B
STLA
Stellantis N.V.		 $6.34 $18.4B N/A 5.8% -13.9% $155.8B
"The management of a business is its most important single factor — more important than market position, patents, or financial structure."
— Benjamin Graham
Capital Allocation & Alignment
Insider Ownership
0.01%
Low — management has little skin in the game
Return on Equity (ROE)
-3.3%
Weak — poor returns on equity
Return on Assets (ROA)
-1.6%
Poor — assets are not generating adequate returns
Debt Trend YoY
-0.4% YoY
Debt is declining — management is deleveraging
Leadership Team
Donghui Ma
President & Executive Director
Age 50
Tie Li
CFO & Executive Director
Age 47
Xiang Li
Founder, Executive Chairman & CEO
Age 44
Pay: $283,555
Liangjun Zou
Senior Vice President
Age 47
Top Institutional Holders
Institution % Owned Shares
Renaissance Technologies, LLC 0.80% 7,110,639
Xiamen Xinweidachuang Investment Partnership (limited Partnership) 0.55% 4,926,165
Morgan Stanley 0.43% 3,786,866
SIH Partners, LLLP 0.39% 3,430,250
Citigroup Inc. 0.31% 2,787,853
American Century Companies Inc 0.22% 1,966,699
UBS Group AG 0.20% 1,745,863
Blackrock Inc. 0.11% 984,682
Risk Analysis
Beta (Market Risk)
0.51
Low volatility — more stable than the market
Short Interest
4.6% of float
Low short interest — market is not heavily bearish
Debt-to-Equity
0.25x
Conservative balance sheet — low financial risk
Current Ratio
1.88x
Adequate liquidity
52-Week Price Range
Low: $13.16 Current: $13.21 High: $32.02
Currently at 0% of 52-week range

Li Auto Inc. (LI) fundamental analysis — Overall grade C based on profitability, financial health, valuation and cash flow. Graham's Fair Value: N/A (negative EPS). Gross profit margin: 7.9%. Operating margin: -13.0%. Net margin: -10.0%. Market cap: $13.3B. Sector: Consumer Cyclical. Industry: Auto Manufacturers. Analysis powered by 360investing — free fundamental stock analysis based on Benjamin Graham and Warren Buffett principles.

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