Reviewing Li Auto (NASDAQ:LI) & Renault (OTCMKTS:RNLSY)

Li Auto (NASDAQ:LI) and Renault (OTCMKTS:RNLSY) are both auto/tires/trucks companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, earnings, profitability, institutional ownership, dividends and risk.

Institutional & Insider Ownership

9.9% of Li Auto shares are owned by institutional investors. 48.5% of Li Auto shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility and Risk

Li Auto has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, Renault has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500.

Profitability

This table compares Li Auto and Renault’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Li Auto	-1.72%	-2.58%	-1.22%
Renault	N/A	N/A	N/A

Earnings & Valuation

This table compares Li Auto and Renault”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Li Auto	$16.06 billion	0.88	$160.79 million	($0.28)	-47.20
Renault	$65.52 billion	0.14	-$12.37 billion	N/A	N/A

Li Auto has higher earnings, but lower revenue than Renault.

Analyst Recommendations

This is a summary of current recommendations and price targets for Li Auto and Renault, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Li Auto	4	10	1	1	1.94
Renault	2	3	1	0	1.83

Li Auto presently has a consensus price target of $17.30, indicating a potential upside of 30.91%. Given Li Auto’s stronger consensus rating and higher probable upside, analysts clearly believe Li Auto is more favorable than Renault.

Summary

Li Auto beats Renault on 7 of the 12 factors compared between the two stocks.

About Li Auto

Li Auto Inc. operates in the energy vehicle market in the People's Republic of China. It designs, develops, manufactures, and sells premium smart electric vehicles. The company's product line comprises MPVs and sport utility vehicles. It offers sales and after sales management, and technology development and corporate management services, as well as purchases manufacturing equipment. The company 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.

About Renault

Renault SA engages in the design, manufacture, sale, repair, maintenance, and leasing of motor vehicles in Europe, Eurasia, Africa, the Middle East, the Asia Pacific, and the Americas. It also engages in the design and production of parts and equipment used for manufacturing and operation vehicles. The company operates through Automotive, Sale Financing, and Mobility Services segments. Its Automotive segment produces, sells, and distributes passenger cars and light commercial vehicles; and invests in automotive-sector associates and joint ventures primarily in Nissan. The company's Sale Financing segment offers sale financing, leasing, maintenance, and services contract under the Mobilize Financial Services brand. Its Mobility Services segment provides mobility and energy solutions for electric vehicle users under the Mobilize brand. In addition, it is also involved in the design, manufacture, and sale of passenger cars and light commercial vehicles under the Renault, Dacia, Alpine, and Mobilize brands. Further, the company offers used vehicles and spare parts; and engages in business-to-business powertrain activities, and research and advanced engineering activities. Renault SA was founded in 1898 and is based in Boulogne-Billancourt, France.