Assessing Li Auto (NasdaqGS:LI) Valuation After Weak 2025 Results And Guidance For Further Declines

Li Auto (LI) has drawn fresh attention after reporting weaker fourth quarter and full year 2025 results, while signaling further year over year declines in revenue and deliveries for the first quarter of 2026.

See our latest analysis for Li Auto.

The latest earnings miss and cautious outlook help explain why Li Auto’s 1 year total shareholder return is down 36.89%. At the same time, the 90 day share price return of 4.15% hints at tentative short term momentum from recent product and AI updates.

If Li Auto’s swings are making you reassess your options, it could be a good moment to look at 30 robotics and automation stocks as a way to find other automation focused names linked to AI and advanced manufacturing.

With Li Auto’s share price still well below its past highs and the business in a reset phase, the key question now is simple: is the current valuation too pessimistic, or is it already factoring in any future recovery in growth?

Most Popular Narrative: 29.1% Undervalued

Li Auto’s most followed narrative puts fair value at $24.43 versus the last close of $17.33, framing the stock as materially discounted and heavily dependent on long term execution in EVs and software.

The rapid buildout of Li Auto’s ultra-fast charging network (now the largest among Chinese automakers, with plans to reach 4,000 stations by year-end) and development of charging technology (e.g., 5C batteries and autonomous charging robots) enhances user experience and alleviates range anxiety, thus accelerating BEV adoption and boosting sales volumes.

Read the complete narrative.

Curious how this charging buildout, expected revenue expansion, projected margins, and a higher future earnings multiple all fit together into that fair value story? The full narrative connects these moving parts into one valuation roadmap, including how fast revenue and earnings would need to compound and what kind of profitability profile Li Auto is modeled to reach to justify that gap to $24.43.

Result: Fair Value of $24.43 (UNDERVALUED)

Have a read of the narrative in full and understand what’s behind the forecasts.

However, this depends on Li Auto containing rising R&D and AI spending, while also avoiding prolonged delivery and revenue declines that could pressure cash flow and valuation assumptions.

Find out about the key risks to this Li Auto narrative.

Another View: Rich Earnings Multiple Raises Questions

That fair value of $24.43 paints Li Auto as undervalued, but the current P/E of 108.5x tells a very different story. It sits far above the global auto industry at 18.6x, peers at 38x, and even the fair ratio of 32.6x. Is the market overpaying for future earnings here?

See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

If the mixed signals here leave you on the fence, do not wait too long to check the underlying numbers yourself and weigh both sides. 2 key rewards and 2 important warning signs gives you a clear snapshot of what the market is currently worried about and what it still likes.

Looking for more investment ideas?

Do not stop with a single company story. Use this moment to scan for other opportunities that fit your style before the next move in the market.

This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

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