Shop Stock: Luminar Technologies Scanning for a Promising Road Ahead
Many companies and even societies are betting on a future filled with autonomous vehicles. This future comes closer every time another test is completed or a product is unveiled, but the complex reality of urban environments poses a significant barrier to an autonomous lifestyle in the city.
Hands-free highway driving is a much more achievable goal, not to mention a lucrative market, and Luminar Technologies Inc. (LAZR) says it has the lidar system to make that happen. (See LAZR stock chart on TipRanks)
Gus Richard of Northland Capital Markets is optimistic on LAZR’s outlook. After explaining that Luminar presented its new lidar system fully implemented into a Volvo SUV, he wrote opined that “LAZR is the first Lidar Company to meet auto-grade specifications that is manufacturable, scalable, and easily integrated into a car that meets the aesthetic requirement for a production car.”
The five-star analyst assigned a Buy rating and declared a price target of $38, reflecting a possible 12-month upside of 62.32% from the stock’s Friday closing price of $23.41.
Rather impressed by Luminar’s presentation, Richard wrote that the company is leading in lidar systems with its Iris platform, and that the technology will be necessary for any more complex forms for autonomy which will eventually come along.
He mentioned that Iris is scheduled to go into production by late 2022 with both Volvo and Chinese SAIC Motors Corporation, a Chinese auto manufacturer.
In regards to autonomous highway driving being a step toward full urban autonomy, Richard compared that to the “iPod being the precursor to the iPhone.”
However, the analyst was not fully smitten by the company, and did delineate a harsh reality that Luminar has to overcome. He explained that “Luminar is an early to a mid-stage technology startup. It needs to develop the processes and procedures of a public company that currently does not exist. Our estimates may not factor in the full burden of the cost of being a public company.”
On TipRanks, the analyst rating consensus for LAZR is a Moderate Buy, based on 3 Buy and 4 Hold ratings. The average analyst Luminar Technologies price target is $26.43 per share, reflecting a potential 12-month upside of 12.90%.
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