Go Long on a Lidar Contender with Pure-Play Microvision Stock

Headquartered in Redmond, Washington, Microvision (NASDAQ:MVIS) is a small company that wants to be a big name in lidar (light detection and ranging). And in my opinion, for folks who want to take a position in this type of technology, MVIS stock is a solid choice.

LiDAR sensors show car sensing traffic around it. LAZRSource: Shutterstock

To explain it briefly, lidar systems use laser beams to form a three-dimensional image of the surveyed surroundings. That makes a real-time map of the environment. On-board computers can use that to help navigate self-driving vehicles, for instance.

There are currently only a handful of pure-play, publicly traded lidar stocks on U.S. markets today. Each company is unique and has its own strengths which investors must consider.

So, if you’re excited about the future of lidar and its potential applications for autonomous vehicle (AV) tech, then strap in to learn more about Microvision.

A Closer Look at MVIS Stock

To start, we should look at this company’s price action. You might be surprised to learn that MVIS stock has actually been trading since the 1990s. In fact, it was part of the notorious dotcom bubble — as well as that bubble’s bursting.

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Today, though, investors shouldn’t expect this stock’s price to reach $500 like it did in the year 2000. Instead, $20 is a reasonable goal for the bulls.

The stock was trading above that level recently, when it reached a 52-week high of $24.18 on Feb. 16. The share price tumbled after that, however, landing at $14.87 on February’s final trading session. Today, MVIS changes hands at around $17.

All that said, though, it should be acknowledged that MVIS stock has been on an impressive bull run over the past year. Back in March of 2020, the shares were trading at only around 20 cents apiece.

So, I suppose we could say that the trend is long-term down, medium-term up and short-term down.

But regardless of these nuances in the price action, the stock could certainly be a worthy investment if you’re a lidar lover and you believe in this name’s growth prospects.

Long-Range Lidar

Stakeholders of MVIS stock should be excited to learn that the company recently received the “necessary components and equipment” to meet its April-targeted milestone for the development of its Long Range Lidar (LRL) Sensor.

Lidar techies should be duly impressed. Microvision CEO Sumit Sharma details the finer points of his company’s latest LRL iteration:

“We expect our 1st generation LRL Sensor to have range of at least 250 meters and the highest resolution at range of any lidar with 340 vertical lines up to 250 meters, 568 vertical lines up to 120 meters and 944 vertical lines up to 60 meters. This equates to 520 points per square degree.”

This is a huge deal for the company, especially as Microvision’s LRL Sensor has been in development for more than two years.

And quite reasonably, the CEO expects the LRL Sensor to meet or exceed original equipment manufacturer (OEM) requirements upon release. That sets the tech up nicely for adoption down the line.

An Apple Target?

If you haven’t read InvestorPlace analyst Luke Lango’s write-up on Microvision’s potential Apple (NASDAQ:AAPL) connection, please be sure to check out that essential article.

I specifically bring it up, though, because Lango alerted me of something I hadn’t previously considered. Namely, that Apple will likely be on the hunt for a self-driving partner in the near future.

Like I alluded to earlier, there aren’t a whole lot of publicly traded pure-play lidar specialists out there. And in developing the autonomous Apple Car, Apple will need help from a premier lidar specialist.

When it comes to specifications, Microvision’s LRL Sensor’s expected range of 250 meters is industry-leading. So are the LRL Sensor’s expected 520 points per square degree of resolution. Yet, the LRL Sensor is also predicted to cost less than $1,000 per car once in full-scale production. On all of those fronts, it seems to fit Apple’s bill.

Now, as a responsible writer, I don’t want to stoke the fire of speculation. But just bear in mind that a lidar-manufacturing deal with Apple would undoubtedly send MVIS stock through the roof.

The Bottom Line

Even if we ignore the possibility of an Apple deal, MVIS stock is still worth holding. After all, the company’s lidar technology is in a class by itself and could lead to big things in AVs.

With that in mind, a share price of $20 should be easily attainable. After that, $24 should be the next target for the bulls.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

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