Despite experiencing a recent surge in stock price, Li Auto, a Chinese electric vehicle company, is still down roughly 49% year to date. The company's stock closed trading on Monday with significant gains of 6.7%, following better-than-expected vehicle delivery results for June. Li Auto delivered 47,774 vehicles in June, showing a nearly 47% increase compared to the same period last year. Even with positive delivery trends, Li Auto's stock remains undervalued at approximately 17 times this year's expected earnings. However, investors should be cautious due to potential macroeconomic and geopolitical risks, including ongoing political tensions between China and the U.S. While the stock may appear attractively valued based on recent performance, these external factors could pose significant challenges for the company in the future. Investors must balance the potential upside with the inherent risks associated with investing in Chinese stocks traded on U.S. exchanges.