Li Auto Price Target Cut to $22, but Wall Street Still Sees Upside

2 hours ago 1

Joel South

Fri, March 27, 2026 astatine 9:29 AM CDT 4 min read

Li Auto (LI) posted Q4 conveyance deliveries of 109,194 units, down 31.2% twelvemonth implicit year, with conveyance margins compressing to 16.8% from 19.7%, but Morgan Stanley maintained an Overweight standing with a $22 terms people reflecting expected borderline betterment from the all-new L9 motorboat successful Q2 2026 and sustained AI-native R&D concern of $3.0 billion.
Li Auto’s way to Morgan Stanley’s $22 people requires palmy L9 motorboat execution to stabilize margins, transportation betterment successful 2026, and alleviation from China’s intensifying EV terms warfare that has pressured quarterly revenue.
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Li Auto Inc. (NASDAQ:LI) has had a turbulent stretch. The banal is up 4.67% implicit the past week and level implicit the past month. But implicit the past year, shares are down by much than 32%.

Most analysts clump astir a statement people of $21.98, reflecting cautious near-term sentiment. Morgan Stanley expert Tim Hsiao has kept his Overweight standing intact portion cutting his terms people to $22 from $26, implying meaningful upside from the existent terms of $17.58. That $22 people sits conscionable supra Street consensus, signaling Morgan Stanley remains among the much constructive voices connected the name.

But tin LI realistically scope $22 by the extremity of 2026?

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Morgan Stanley adjusted its 2026-27 net forecasts to bespeak cyclical and operational headwinds pursuing Q4 results and up of the L9 launch. The Q4 numbers were difficult: conveyance deliveries fell 31.2% twelvemonth implicit twelvemonth to 109,194 units, and conveyance borderline compressed from 19.7% to 16.8%. Despite those headwinds, Hsiao sees the merchandise rhythm turning successful 2026 arsenic crushed to enactment constructive, with the steadfast noting that portion Li Auto faces execution hurdles, it remains constructive connected the shares.

All-New Li L9 Launch (Q2 2026): The all-new Li L9, planned for Q2 2026, volition diagnostic broad upgrades successful powertrain, autonomous driving, and chassis technology. CEO Xiang Li called it "a generational leap successful idiosyncratic experience." A palmy flagship motorboat could reset borderline expectations and reignite transportation maturation implicit a multi-year horizon.
AI-Native R&D Investment: Li Auto's R&D spending roseate 25.3% twelvemonth implicit twelvemonth to $3.0 billion, centered connected its VLA Driver ample exemplary and restructured AI-native R&D system. Sustained concern successful autonomous driving exertion positions the institution for semipermanent differentiation successful a winner-takes-most EV segment.
Fortress Balance Sheet and Buyback: Li Auto ended Q4 with $8.11 cardinal successful currency and equivalents and a board-approved $1.0 cardinal stock repurchase programme valid done March 31, 2027. Capital returned to shareholders portion maintaining fiscal flexibility is simply a durable compounding awesome for semipermanent accounts.