A Look At Li Auto’s Valuation As A US$1b Buyback Follows Weaker Q4 And Soft Q1 2026 Guidance

Simply Wall St.03-26 10:08

AdvertisementWhy Li Auto’s new buyback matters for shareholders Li Auto (NasdaqGS:LI) just approved a US$1.0b share repurchase program running through March 31, 2027, funded from existing cash, after ...

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However, the 1 year total shareholder return of a 30.83% decline shows momentum has...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4099":"汽车制造商","BK4588":"碎股","BK4585":"ETF&股票定投概念","BK4526":"热门中概股","BK4548":"巴美列捷福持仓","BK4563":"昨日强势股","EVS.SI":"MSCI China Electric Vehicles and Future Mobility ETF-NikkoAM","BK4555":"新能源车","BK4503":"景林资产持仓","02015":"理想汽车-W","BK4551":"寇图资本持仓","LI":"理想汽车"},"translate_title":"在2026年第四季度疲软和第一季度指引疲软之后，理想汽车的估值将被视为10亿美元回购","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"02015":1.97,"EVS.SI":0.6,"LI":1.97},"content_text":"AdvertisementWhy Li Auto’s new buyback matters for shareholders Li Auto (NasdaqGS:LI) just approved a US$1.0b share repurchase program running through March 31, 2027, funded from existing cash, after reporting weaker Q4 2025 results and softer guidance for Q1 2026. See our latest analysis for Li Auto. At a share price of US$18.08, Li Auto has a 7 day share price return of 5.73% and a 90 day share price return of 3.67%. However, the 1 year total shareholder return of a 30.83% decline shows momentum has been weak over a longer stretch, with the buyback and recent L9 launch commentary now drawing attention back to how sentiment around future growth and risk may be shifting. If Li Auto’s recent moves have you thinking about where else capital could go to work in this space, it might be worth scanning 35 AI infrastructure stocks With a US$1.0b buyback on the table, a 30.83% one year total return decline and weaker recent earnings, the real question is whether Li Auto’s current price reflects too much pessimism or already bakes in any future recovery. Most Popular Narrative: 18.4% Undervalued Li Auto’s most followed valuation narrative pegs fair value at $22.16, above the last close at $18.08. This puts the new buyback into a different light for many investors.  The company's ongoing transition from extended-range vehicles (EREVs) to pure battery electric vehicles (BEVs), including successful launches of the Li MEGA and Li i8, and the upcoming Li i6, positions Li Auto to capture expanding market share as Chinese middle-class consumers upgrade and EV adoption accelerates, directly supporting long-term revenue growth and total addressable market expansion.  Read the complete narrative. Curious what kind of revenue path, margin rebuild, and future earnings multiple are being baked into that fair value label. The full narrative spells out the growth runway, the profit ramp, and the valuation bridge in detail, including how those pieces line up with today’s share price and the new buyback capacity. Result: Fair Value of $22.16 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, there is still real execution risk, with high R&D and capital spending, and intense NEV competition potentially pressuring margins and slowing the transition toward higher value software revenue. Find out about the key risks to this Li Auto narrative. Another angle on valuation That 18.4% “undervalued” label sits awkwardly next to Li Auto’s current P/E of 113.3x, versus 38.2x for peers and a fair ratio of 33.4x. The gap suggests investors are paying a hefty premium, not a discount. This raises the question of whether the real risk is that expectations are simply too high. To see how that premium compares with other companies, and what the numbers imply for valuation risk, take a closer look at our detailed multiples breakdown See what the numbers say about this price — find out in our valuation breakdown. NasdaqGS:LI P/E Ratio as at Mar 2026Next Steps With sentiment clearly split between concern and optimism, it makes sense to look at the full picture yourself and decide quickly where you stand. You can start with the 1 key reward and 1 important warning sign Looking for more investment ideas? If Li Auto has sharpened your focus, do not stop there. Use the screener to uncover other companies that could fit your goals before the market moves on.  Target potential mispricing by scanning 55 high quality undervalued stocks with solid fundamentals and room for a re rating if sentiment improves. Prioritize resilience by focusing on 75 resilient stocks with low risk scores that score well on stability and financial strength. Get ahead of the crowd by checking screener containing 25 high quality undiscovered gems that most investors may not be watching yet.   This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    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\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.New: AI Stock Screener & AlertsOur new AI Stock Screener scans the market every day to uncover opportunities.• Dividend Powerhouses (3%+ Yield)• Undervalued Small Caps with Insider Buying• High growth Tech and AI CompaniesOr build your own from over 50 metrics.Explore Now for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. 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