Tesla (TSLA) Speculation Could Drive Mobileye (MBLY)

Mobileye N.V. (NYSE: MBLY) could benefit Monday from speculation of a deal with Tesla Motors (NASDAQ: TSLA), after an analysts' factory tour showed the popular electric vehicle maker is in fact working on driver assistance features.

In a research report on Tesla Sunday, following the tour, Global Equities Research analyst Trip Chowdhry noted that on the factory floor, they observed an area set aside and labeled "Driver Assist." Commenting on this he said, "We at GER speculate, it is more than just parking sensors and probably it could very well be the much rumored feature of "Driver Assist" that could be using MobileEye technology."

Mobileye, which had its IPO in early August, designs and develops software and related technologies for camera-based Advanced Driver Assistance Systems (“ADAS”). The company's proprietary software algorithms and EyeQ​ chips perform detailed interpretations of the visual field in order to anticipate possible collisions with other vehicles, pedestrians, cyclists, animals, debris and other obstacles. The company's products are also able to detect roadway markings such as lanes, road boundaries, barriers and similar items, as well as to identify and read traffic signs and traffic lights. The company's prospectus listed Tesla as one of the OEMs it has an agreement with, although no vehicles are on the market at this time with the technology.

The ultimate speculation - although likely years away - would be complete driverless vehicle powered by in part by Mobileye technology. Tesla founder and CEO, Elon Musk, as well as Google co-founder Sergey Brin, have taken interest in the idea.

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