Piper Positive on Mobileye (MBLY) Amid Reports Tesla (TSLA) Lost Key Mapping, Navigation Exec
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Piper Jaffray affirms Mobileye (Nasdaq: MBLY) at Overweight with a price target of $60 following news that Tesla recently lost a key mapping exec.
The firm commented today,
The Information, which is a technology-oriented news website, reported that Tesla (Nasdaq: TSLA) has lost Bill Chen, who was leading the company's mapping and navigation efforts. If true, this development could be a positive sign for Overweight-rated MBLY, who we think recently "fired" Tesla as a customer. Dynamic 3D mapping is a key bottleneck in the development of self-driving vehicles, and MBLY is trying to convince all car companies to standardize around its "REM" platform. Any speed bumps in Tesla's own (competing) self-driving program could eventually force the company to admit that MBLY's platform is the only viable way forward.
Overall thoughts on Mobileye:
Although our exact forecast and valuation methodology are a topic for debate, we think headline catalysts will be the most important driver of MBLY's stock performance in the coming year. With competitors apparently reeling, we think evidence is growing that MBLY will succeed in establishing the industry standard for self-driving vehicles, thereby locking itself into a quasi-monopolistic position (similar to Windows/Intel for PCs).
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