SPECIAL REPORT The Top 7 Stocks for 2024

Q4 Stock Predictions: 3 Autonomous Driving Stocks Ready to Roar Into 2024

Advertisement

  • You can’t go wrong with any of the picks below.
  • Ambarella (AMBA): A chip designer that designed a crucial position for itself in the market.
  • Luminar Technologies (LAZR): Market-beating performance this year gives it greater promise.
  • Aurora Innovation (AUR): This is running hot from analyst recommendations in the middle of this year.
autonomous driving stocks - Q4 Stock Predictions: 3 Autonomous Driving Stocks Ready to Roar Into 2024

Source: Olivier Le Moal / Shutterstock.com

Autonomous driving stocks have great potential. Although their emergence can be primarily seen in Asian markets, I don’t believe it will be long before their reach extends to the rest of the world. Autonomous driving stocks promise safer everyday driving and also have use in specific commercial and industrial applications.

Although most autonomous driving stocks are firmly in the research and development stages, some are booking revenue from preorders and forecast a great demand for the solutions in the future.

So if you are keen on investing in the future of transportation, keep reading. Here are the best autonomous driving stocks to buy as we head into the fourth quarter.

Ambarella (AMBA)

Ambarella (AMBA) logo on a corporate building
Source: Sundry Photography / Shutterstock.com

Ambarella (NASDAQ:AMBA) is a chip designer company that has been in the market for several years. The company’s video chip designs are found in automotive camera systems, video security cameras, and industrial applications like robotics.

Despite facing challenges in the chip industry, Ambarella is expected to see a resurgence. With the growing adoption of advanced driver assist systems and better autonomous driving technology, Wall Street believes AMBA stock will experience double-digit revenue growth in 2024.

It should be noted the AMBA stock had a rough start. In the financial update for Q1 2024, the reported revenue stood at $62.1M, marking a significant decline of 31% from Q1 2023. The GAAP gross margin has slightly tapered off to 60.4%, compared to 62.6% from the same period in the previous year. The company’s books reflect a GAAP net loss of $35.9M, amounting to $0.91 per share, a considerable increase from the $10.8M loss ($0.29/share) observed in Q1 2023.

Still, the growth of the overall market as well as the automotive industry’s enthusiasm for AMBA stock makes it one of the autonomous driving stocks to buy.

Luminar Technologies (LAZR)

Luminar (LAZR stock) sign with greenery around it
Source: JHVEPhoto/shutterstock.com

Luminar Technologies (NASDAQ:LAZR) is a key player in the autonomous driving market, providing lidar systems to leading OEM vehicle manufacturers. LAZR stock has shown impressive financial growth, with a 63% surge in second-quarter revenues. The company is investing heavily in research, development and manufacturing to bring its vision to fruition.

There’s also more good news. Last quarter, LAZR reported a smaller quarterly loss than expected at $0.21 per share compared to the estimated loss of $0.23. Also, over the past year, LAZR exceeded EPS estimates twice and beat revenue estimates three times out of four quarters. The company’s stock has grown by 36.4% since the beginning of the year, outpacing the S&P 500‘s gain of 17.7%.

With these factors considered, LAZR is also one of those autonomous driving stocks that look poised for takeoff next quarter. It may also be trading at undervalued levels compared to its upside potential.

Aurora Innovation (AUR)

a phone displaying the Aurora website in front of a computer screen displaying the company logo
Source: T. Schneider / Shutterstock

Aurora Innovation (NASDAQ:AUR) is a standout name in the autonomous driving sector. Aurora’s system is built to withstand diverse weather conditions, giving it an edge over competitors. With most of its pre-launch milestones achieved, Aurora plans to introduce a transformative self-driving subscription service before 2025. That gives it a significant head start out of the gate over its many competitors in the space.

Some Wall Street analysts are also very bullish on AUR stock. In July, shares of the stock surged 43.1% in a week following an optimistic analyst report from Canaccord Genuity. The analyst cited Aurora’s strong management and growth potential in the self-driving truck market.

Due to the relatively small market caps of these companies and their ability to stir up hype and FOMO like no other, it’s not surprising that this happened in the case of AUR stock. It’s another reason why I believe it can take off to new heights in Q4.

On the date of publication, Matthew Farley did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.


Article printed from InvestorPlace Media, https://investorplace.com/2023/10/q4-stock-predictions-3-autonomous-driving-stocks-ready-to-roar-into-2024/.

©2024 InvestorPlace Media, LLC