Mobileye (MBLY) May Still be Cheaper Way vs. Tesla (TSLA) to Ride Autonomous Vehicle Wave

July 7, 2016 2:17 PM EDT
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Price: $62.67 --0%

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Mobileye (NYSE: MBLY) shares ticked higher earlier Thursday following a largely positive report from the WSJ.

The report notes that recent bumps in the sentiment behind autonomous vehicles -- no doubt due largely in part to crash reports on Tesla (Nasdaq: TSLA) vehicles recently -- could benefit Mobileye.

While Mobileye partners with Tesla and, as announced last week, others including BMW, on autonomous vehicle technology, the company also makes the lion's share of its money in less-risky environments. The company operates within the advanced driver assistance systems segment, which helps to automate the process of parking a vehicle and powers adaptive cruise control. Both offer similar features to Tesla's Autopilot, though they require input from the driver to work. That segment is expected to grow to $1.1 billion by 2019 and the company has many contracts in place through then.

Overall, Mobileye is a cheaper way than Tesla to make a play on the autonomous vehicle segment, with shares trading around 60 times forward earnings expectations.

Shares of Mobileye are down 3 percent Thursday



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