Why Mobileye's Mapping News Is 'A Game Changer'

• Mobileye NV MBLY shares have declined 28.35 percent over the past six months, dropping to $36.13 on January 5.
• Deutsche Bank’s Rod Lache has maintained a Buy rating on the company, with a price target of $72.
• Terming the company’s mapping announcement a “game changer,” Lache mentioned that Mobileye’s innovations were likely to drive the company to achieve a dominant market position.

Analyst Rod Lache elaborated, “We believe that Mobileye’s announcement of partnerships with 3 of the 4 largest global Auto OEMs represents one of the most significant and potentially disruptive ADAS/Autonomous Driving developments that we have seen to date.”

Lache believes that this development to lead to Mobileye gaining a meaningfully higher market share, along with significantly higher margins and possibly large revenue opportunities, not earlier expected.

According to the Deutsche Bank report, “Almost all of the Global Auto Industry’s major OEMs are now aggressively pursuing autonomous driving. And to achieve advanced levels of autonomy, it is widely believed that vehicles will require up to date mapping data.”

However, it was commonly believed that while highly detailed 3D maps would be needed, it would be difficult to maintain them in real time.

Mobileye has developed an innovative solution for this, utilizing extremely detailed 2D maps and augmenting them with the available 3D datapoints, “collected from millions of vehicles that are equipped with Mobileye’s camera based ADAS systems,” the report stated.

The data would then be sent back to the company’s servers, from which real time crowd sourcing maps would be created. This would provide the thus far missing link to autonomous driving.