Goldman Sachs warns of 35% downside in this self-driving car tech stock

on Mar 22, 2023
  • Goldman Sachs downgraded Luminar Technologies Inc to "sell" today.
  • Analyst Mark Delaney says the stock is expensive at current valuation.
  • Luminar stock is already down more than 35% versus its recent high.

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Luminar Technologies Inc (NASDAQ: LAZR) ended about 15% down today after a Goldman Sachs analyst turned bearish on the company that makes vision-based lidar sensors for autonomous cars.

Luminar stock could sink to $5.0 a share

On Wednesday, Mark Delaney recommended that investors sell this tech stock as it could shrink further to $5.0 a share – down about 35% versus its previous close.

The analyst dubs Luminar stock a bit too expensive to own at current valuation. Explaining why, he said in his research note:

We see downside to the company’s margin outlook with the company targeting revenue per vehicle of ~$1K which we believe implies ASPs roughly 50%-100% higher than key competitors for MEMs/solid state lidar.

Last month, Luminar Technologies reported its financial results for the fourth quarter that missed Street estimates.

Luminar stock is already down a lot this month

Luminar Technologies is currently trading at about four times EV/2025 revenue – a significant premium to just one time for peers Innoviz and Hesai.

Other reasons the Goldman Sachs analyst cited in his note for the bearish view on Luminar stock that’s now down over 35% versus its recent high include intense competition.

Market for ADAS/AV software is highly competitive and we believe underlying hardware gross margins, and tailwind from software, could be lower than the company targets (a long-term non-GAAP EBIT margin of 35%-40%.

Delaney remains unconvinced even though Mercedes-Benz expanded its partnership with the Nasdaq-listed firm last month and said it’ll use the Luminar’s in a broad range of its vehicles in the coming years.


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