Mobileye NV (NYSE:MBLY) is rapidly becoming one of the the key players in the advanced driver assistance systems (ADAS) and semi-autonomous driving sector. A September 4th Barclays Equity Research report argues that with use of advanced analytics software and a gargantuan data set, “Mobileye creates a ‘virtuous cycle’ that provides a sustainable competitive advantage and the most cost-effective ADAS solution on the market today.”
Barclays analysts Brian A. Johnson and colleagues currently rate Mobileye as Overweight and have put a $49 price target on the stock.
Mobileye 2Q 2014 earnings results
The firm’s second quarter 2014 earnings results largely matched their guidance for the quarter. Mobileye NV (NYSE:MBLY) reported scintillating revenue growth of 91%, a gross margin of 75% and an operating margin of 43%. These strong results reflect the burgeoning growth of the ADAS market and the company’s very competitive position in that expanding market.
Mobileye also offered investors updated 2014 guidance. Revenue for 2014 is now expected to come in around $133-135 million compared to the prior outlook of $130 million, which suggests 2H sales of $64-66 million vs Barclays estimate of $67 million; 2014 net income is guided to $41.7-42.3 million, suggesting a 2H net income of $17.9-18.5 million compared to Barclays estimate of $19.9 million. Of note, the second half revenue outlook (revenues down $3-5 million from the first half) makes it clear that in addition to launch-related revenue sorting out, there seems to be some seasonality of revenue, similar to what other auto suppliers experience.
Earnings remain in-line with projections in IPO prospectus
Mobileye NV (NYSE:MBLY)’s earnings per share of 5 cents matched both Barclays estimate and consensus estimates, and the reported net income of $11.2 million was also in-line with our estimate of $11.1 million and guidance of $10.9-11.3 million. Gross revenues came in slightly higher than expected, totaling $33.7 million compared to Barclays estimate of $32.9 million and guidance of $32.9-33.5 million. The firm’s 2Q gross margin of 74.6% was also quite close to our estimate of 74.9%.
