Deutsche Bank said Li Auto has an attractive entry point for investors following the recent sell-off. Analyst Edison Yu upgraded the Chinese electric car maker’s U.S.-listed shares from hold to buy, while lowering his price target by $4 to $41. His new target suggests the stock could rise 46.4% from Monday’s closing level over the next 12 months. The stock price has fallen about 28% since late November. This performance is worse than that of the KraneShares CSI China Internet ETF (KWEB), which has fallen about 14% over the same period. LI KWEB 3M Mountain Re Auto vs. ETF, 3 Months This underperformance comes despite Re having a “best-in-class” management team, the analyst said. Lee also added that the company has a track record of achieving ambitious volume and cost targets. Yu noted that there should be some weakness in the first quarter. But he said new models and improvements to existing cars should help sales volumes and profit margins recover from the second quarter. Following the decline, Yu said, “Our strong product pipeline positions us attractively for the coming quarters, and we are further supported by an attractive valuation as a top-tier EV player.” Mr. Li’s decline also comes as investors are increasingly wary of companies with a large presence in China amid concerns about the current state of consumers. Chinese stocks are also under widespread pressure. Even after rising 3.2% on Tuesday to end a six-day losing streak, the Shanghai Composite Stock Price is still down more than 6% year-to-date. Yu noted that he adopted a lower multiple for Li Auto given widespread rating downgrades in Chinese ADR stocks and across global electric vehicle manufacturers. In fact, Yu is still considered relatively conservative on the street. The average analyst rates the stock a buy, while setting a price target that reflects an impressive upside of nearly 83%, according to FactSet. Lee shares soared more than 6% in early trading Tuesday. The stock has plunged nearly 20% so far in the new year, giving up some of its gains after rising 83.5% in 2023.