Every now and again, a technical breakthrough occurs that irrevocably affects both our lives and the world around us. Henry Ford’s assembly line delivered automobiles to the public, the internet revolutionized the way we communicate, and mobile phones only amplified those developments, while becoming a phenomenon in their own right. Today, advances in computing, vehicles, and networking are merging together and will have a significant impact on the intricacies of our automobiles.
The modern advancement we can point to is already visible. Light detection and ranging (LiDAR) technology is a sensor technology that already improves car safety and navigation systems by providing driver assistance, as well as providing the sensitivity required to enable autonomous vehicles. Last year, worldwide demand for LiDAR in the automotive industry reached $555 million, and this figure is predicted to rise by more than $8.6 billion by the end of this decade, representing a compound growth rate of 40% or more. As we’re seeing an autonomous driving revolution heading our way, few industries provide such potential for development, making LiDAR an excellent long-term investment for patient investors.
There are three equities in this particular space that I’m excited about. I’m specifically narrowing my focus to outstanding growth stocks, each reasonably priced (to not overwhelm anyone), with a very bright future ahead of them. Let’s break down these timely tickers:
Allegro Microsystems Inc (ALGM)
Allegro MicroSystems, Inc. (ALGM) develops, produces, and distributes a wide range of sensor integrated circuits (ICs), as well as photonics and 3D sensing components such as photodiodes for LiDAR applications. The majority of ALGM‘s goods are sold to original equipment suppliers in the automotive and industrial industries. ALGM was established in 1990 and is based in Manchester, NH. ALGM is up YTD by 29.38% with a positive SMA, and has a $7.44 billion market cap, a P/E ratio of 27x, a D/E of 2.59%, TTM asset growth of 30.91%, and TTM revenue of $973 million at 97 cents per share, with its net income of $187.4 million being made possible via a 19.24% net margin. ALGM most recently beat analysts’ EPS and revenue forecasts by 2.73% and 1.67%, respectively, and has a free cash flow of $119.5 million. With a 10-day average volume of 1.62 million shares, ALGM has a median price target of $51, with a high of $54 and a low of $50, representing a potential 39% price upside. ALGM has 6 buy ratings.
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Luminar Technologies Inc (LAZR)
Luminar Technologies, Inc. (LAZR) is a global provider of sensor software and technology for passenger automobiles and commercial trucks. LAZR is a market leader in LiDAR manufacturing in addition to autonomy software applications, particularly for automotive manufacturers. LAZR was established in 2012 and is based in Orlando, FL. LAZR is curiously up YTD by 30.30%, yet its stock has been trading at the bottom of its existing 52-week range, proving itself to be full of momentum. LAZR has a $2.26 billion market cap, TTM revenue of $48.35 million, and, for the present quarter, is forecasted to show revenue of $16.2 million. Per its cash flow statement, LAZR displays an end cash position of over $340 million, and regarding growth, it shows quarterly EPS growth of 3.72%, and annual EPS and revenue growth of 11.56% and 112.20%, respectively. With a 10-day average trading volume of 8.24 million shares, LAZR has a median price target of $12, with a high of $20 and a low of $4.50, representing a potential more than 210% price jump from where it sits now. LAZR has been assigned 8 buy ratings and 3 hold ratings.
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Aeva Technologies Inc (AEVA)
Aeva Technologies, Inc. (AEVA) creates 4D LiDAR chips on a global scale. AEVA uses frequency-modulated continuous wave tech to build its products. AEVA provides a system with embedded software for automotive, industrial, and security applications, as well as algorithms for factory automation and consumer devices. AEVA was established in 2017 and is headquartered in Mountain View, CA. AEVA is down YTD by 19.49%, and is at the very bottom of its 52-week range. WIth a $214 million market cap, AEVA has a P/B ratio of 0.65, YOY growth in EPS (+0.88%) and revenue (+48.64), and a $306 million end cash position, with TTM assets totaling $356.63 million. At its most recent earnings call, AEVA boasted surprises on analysts’ revenue and EPS projections by margins of 38.55% and 9.90%, respectively. With a 10-day average trading volume of 955,000 shares, AEVA has an analyst-assigned median price target of $2.00, with a high of $6.00 and a low of $1.10, which represents a stunning potential price upside of 448%. While perhaps not getting all the attention it deserves to get, it certainly caught mine, and I see a great opportunity here for any long-term investor. The analysts currently have AEVA marked with 5 buy ratings and 3 hold ratings.
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