The total addressable market for self-driving cars will be enormous and there are far fewer LiDAR companies than there are EV startups. Conclusion? $LAZR and $VLDR are likely undervalued while most EV stocks are way overvalued.
The stock market is still suffering from Tesla hype. That’s not going to stop Austin Russel, the genius 25 year old billionaire. Luminar CEO and co-founder Austin Russell was poised to become a billionaire at 25 when his autonomous driving technology company Luminar went public on Thursday, December 3rd, 2020.
But is Luminar a better company than Veloydne? That remains to be seen. Don’t trust the SPACs is really the moral of the story of 2020, when the market is overvalued and when IPOs are doing incredibly just because of the sheer amount of liquidity heading into the stock market. It’s not rational, it’s just a speculative era of the rebound.
Russel founded Luminar in 2012 when he was just a teenager, leaving Stanford University to focus on his company. This isn’t Nikola, it’s not a pipe dream. LiDAR is very real and the dominant tech for self-driving cars that need these lasers to “see” around.
Luminar though so far has the better partnerships. The lidar sensing technology company works with major automakers as well as Intel’s Mobileye. Elon Musk says lidar is not needed for self-driving, but Luminar has a $1 billion-plus book of business and relationships with major automakers.
Tesla in the long run likely won’t win the EV market, it will be too competitive with too many players. But who will win the LiDAR tech race? That is a question for good stock pickers.
Luminar used a special purpose acquisition company to avoid a traditional IPO. Which is shady, if it wasn’t that it’s 2020. Anything goes in 2020, it’s the middle of a pandemic.
Russell was at Stanford University studying physics, but dropped out and received a Thiel Fellowship, created by tech icon and PayPal co-founder Peter Thiel to provide tech talent with alternatives to traditional education programs. Weird that thanks to Thiel America might have a great LiDAR business. Remember LiDAR will be key for robots, not just smart cars.
Luminar has emerged as one of the leading companies in the fast-growing lidar industry. Carmakers are expected to begin offering lidar as an advanced option for their vehicles in the next few years to enable better driver-assistance technology. The total addressable market of smart cars and smart drones and robots using the tech will be enormous in the 2030s and 2040s. I wrote about LIDAR in July, 2020.
Luminar’s stock is up 40% already since its IPO. Lidar is shorthand for light detection and ranging, and it is a way for self-driving cars and other robots to use lasers to detect objects in the world around them and get fast, accurate measures of spatial locations based on how long it takes the laser beams to reflect back to the sensors.
While EV gets all the hype, the global Lidar market was worth about $1.5 billion in 2019, but will reach about $3.6 billion by 2025 — or roughly a 15% compound annual growth rate. By 2030, it will be many multiples higher.
Betting on stocks in 2021 that are for self-driving cars will make a lot more sense than betting on EV startup stocks. But don’t tell the new investors on Robinhood. Luminar works with automakers including Volvo, which is owned by Chinese auto company Geely. But it’s still early days for these LiDAR stocks. It’s too soon to say who the winner will be, so bet on all of them and re-balance your position as necessary.
Luminar is poised to be a provider for China’s self-driving cars. It’s a Florida based firm and Austin Russell’s net worth is about $3 Billion as of today in December, 2020. Luminar was up 36% on Friday at $31, that’s too expensive. Velodyne Lidar is half that at $15 which is justifiable, although a better buy under $10. Remember, the stock market is about 15-20% overvalued in 2020. So remember when to buy and sell.
Russell is one of the first billionaires to emerge from the self-driving vehicle market. In theory, he could be the next Elon Musk.