3 Stocks to Profit on Autonomous Cars

Driving the global AV industry forward, these are stocks to buy for self-driving cars

Stocks to buy for self-driving cars - 3 Stocks to Profit on Autonomous Cars

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The race to get the world’s first fully functional autonomous vehicle is heating up nicely, with several companies targeting the 2021 launch window. The industry’s progress has been halted this year, due to the novel coronavirus pandemic. Despite the slowdown, the Allied Market Research predicts a cumulative growth of 39.47% from 2019 to 2026. Hence the industry provides a massive long-term investment for investors. The stocks to buy for self-driving cars are those pushing the needle in the autonomous vehicle industry.

The AV market is still wide open, and the first movers will ultimately have the lions share in the sector. Large corporations are pouring in colossal amounts of money to fast-track development.

Lets now look at three of the top stocks in the sector currently driving the industry forward:

  • Alphabet (NASDAQ: GOOGL)
  • Ford Motor (NYSE: F)
  • Baidu (NASDAQ: BIDU)

Stocks to Buy for Self-Driving Cars: Alphabet (GOOGL)

Waymo self driving car performing tests on a street near Google's headquarters, Silicon Valley
Source: Sundry Photography / Shutterstock.com

Alphabet is not a traditional automaker but was one of the first major companies to invest in the AVs. Its AV division is called Waymo, which is currently an industry leader. Despite hitting several roadblocks in its journey, the company is valued at over $30 billion. Such a number is mighty impressive for a company in the pre-revenue stage. Hence, it could potentially become a significant catalyst for growth in the future.

This year for Waymo, the big news was that it was able to raise $2.25 billion from external sources. John Krafcik, CEO of Waymo, believes that the company’s technology could be utilized across various forms of transportation. It could expand into several different business facets, including selling its Lidar sensors, ride-hailing, trucking and other services.

The company has already begun work in a lot of these areas in the past couple of years.

In January this year, Waymo announced that it would be testing its autonomous trucks and mapping New Mexico and parts of Texas. Additionally, it recently launched Waymo One, a potential self-driving ride service that potentially disrupts the whole ride-hailing industry.

Ford Motor (F)

3 Reasons It Makes Sense to Steer Away From Ford Stock Right Now
Source: JuliusKielaitis / Shutterstock.com

Ford Motors was criticized for its indecisiveness in investing in AVs but is now among the top companies in the business. It invested $1 billion in a Pittsburgh-based artificial intelligence company called Argo AI in 2017. The company develops maps and virtual driver systems for Ford’s AVs. Moreover, Ford has invested an additional $3 billion in developing its AV business through 2023 which boosting F stock in the future.

The company’s original plans were to deliver its “Level 4” AV by 2021. The novel coronavirus pandemic played spoilsport, forcing Ford to delay its plans until 2022. Additionally, the massive quarterly losses the company is posting aren’t helping either.

Despite the slowdown, the company has tested its strategy through pilot programs with companies such as Postmates and Walmart (NYSE:WMT). Nevertheless, Ford has immense potential to become a significant player in the AV market. It is among the top three companies in the AV market by research firm Navigant Research.

Baidu (BIDU)

An Apollo self-driving car from Baidu (BIDU) drives around California.
Source: Sundry Photography / Shutterstock.com

Chinese tech giant Baidu has been making some significant strides in artificial intelligence and self-driving cars. Last year, it announced that its fleet of 300 driverless cars in China’s various cities had logged over 1.2 million miles. Additionally, it also launched another 45 Level 4 cars for test trials in the Changsha region.

The company also partnered with the Chinese automobile giant FAW to develop the country’s first mass-produced robotaxi.

Hence, AVs will play a significant part in BIDU stock’s future growth.

2020 has been a productive year for Baidu’s EV business, as it recently showed off its fully operational AI car as part of its Apollo project.

Moreover, the company stated that its autonomous driving computer, the Apollo computing unit is ready for deployment. It recently completed its R&D base in Beijing, a 145,000-square-foot facility called the Apollo Park. With an estimated $500 billion market for AV’s in China by 2030, Baidu investors should be licking their lips.

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

Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.


Article printed from InvestorPlace Media, https://investorplace.com/2020/10/3-stocks-to-buy-for-self-driving-cars/.

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