It’s another green day in the stock market, with many tech stocks leading the way higher. Investors in Mobileye (NASDAQ:MBLY) have seen some of the most significant gains, with MBLY stock surging more than 11% this afternoon. This sees MBLY recovering some of the losses the company has seen since the beginning of the year.
This move follows some bullish commentary from the company’s management team during a presentation at Morgan Stanley’s (NYSE:MS) Technology, Media and Telecom conference this morning.
Mobileye reported that sales of the company’s pivotal product, its EyeQ vision technology used by automakers for their autonomous driving and driver-assistance needs, are expected to come in around 3.4 million units during the first quarter. Notably, these numbers are expected to double in the second quarter. This has investors now pricing in much better growth for this tech stock that’s on the brink of profitability.
Let’s dive more into what was discussed and the recent rally behind this unique tech player.
Why Is MBLY Stock Surging Today?
The market tends to be quick to price in new information when it comes to forward guidance. This is particularly true for companies that are relatively early in their growth cycles. For Israel-based Mobileye, a surge in upcoming demand is certainly a good thing.
Now, given how drastically this stock has declined over the past year, investors who bought this stock a while ago will need to see quite a few more days of double-digit upside to recover their losses. But investors looking to put fresh capital to work in a potential high-growth tech stock may be looking at Mobileye closer, particularly at these lower levels.
A doubling of sales over a single quarter is a feat that could lead to much-improved growth forecasts for the company. And given the fact that Mobileye has seemingly done an excellent job of maintaining relatively low costs during its ramp-up period, a move to profitability could be very bullish for this stock.
This is now a company I’ve pushed higher on my watch list as a result of this news, and I’d imagine other investors are doing the same. To be honest, MBLY stock now looks much more attractive after this commentary, and I wouldn’t be surprised to see this momentum continue.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
