- Shares of Mobileye NV MBLY gained more than 5 percent Thursday morning.
- Tesla Motors Inc TSLA shot down rumors that it has plans to replace Mobileye's technology in its cars.
- Several Wall Street firms reiterated a bullish stance on Mobileye despite Citron Research naming the company as a top short idea for 2016.
Short of the year: 2016 $MBLY https://t.co/vd6Gl5ffP5 2014 it was $DDD, 2015 it was $GPRO. So obvious. Peashooter to a gunfight
— Citron Research (@CitronResearch) December 16, 2015
Barclays: Mobileye's Leadership Position ‘Reaffirmed'
Brian Johnson of Barclays commented in a note that over the past few months he "dug deep" on Mobileye, including meeting with senior management at the company's headquarter in Israel.
"Our interactions are timely, as the Mobileye bull-bear debate is heating up heading into the 2016 Consumer Electronics Show early next month," Johnson wrote. "Ultimately, we are increasingly confident that the moats around Mobileye's leadership in ADAS (advanced driver assistance systems) and semi-autonomous driving are widening."
Johnson continued that at the Consumer Electronics Show, Mobileye is expected to announce updates to its autonomous driving software capability, including 360 degree vision based sensing, deep learning, and cloud based functionality. Accordingly, these upsides will confirm the company's "lead" against traditional Tier 1 auto suppliers and automotive chip makers.
Bottom line, Mobileye's leadership position supports a "rapid" revenue growth and "impressive" margin expansion for the company.
Shares remain Overweight rated with an unchanged $76 price target.
Deutsche Bank: Buy Ahead Of CES
Rod Lache of Deutsche Bank commented in a note that while automakers are "seeking to foster competition" in artificial intelligence for autonomous driving, Tesla is likely to be amongst "the first in line" to purchase Mobileye's next generation processor starting in 2018.
Lache continued that 25 other auto manufactures have "effectively endorsed" Mobileye as offering state of the art technology. The analyst added that even though Mobileye has not won every contract it attempted to gain, his research suggests that the company "continues to perpetuate the highest market share in the industry."
Finally, Lache suggested that investors "generally underestimate" the difficulty in replicating Mobileye's current market position and the market, especially average selling prices, will "grow more rapidly than is widely assumed."
Bottom line, Lache argued that Mobileye is "well positioned" for the future and more importantly, 2016 will prove to be a "catalyst rich environment" that could "serve to reinforce this view more broadly."
Shares remain Buy rated with an unchanged $72 price target.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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Posted In: Analyst ColorAnalyst RatingsADASAdvanced Driver Assistance SystemsBarclaysBrian JohnsonCitron ResearchDeutsche BankMobileyeMobileye Top ShortRod LacheSelf Driving Cars
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