Mobileye is one of the top Turnaround Candidates for 2024 - Shipments of EyeQ Chips to Double Again in Q2!

The Israeli specialist for driver assistance systems Mobileye (MBLY) was put under pressure at the beginning of January due to high customer inventories and forecast a 50% slump in sales for the current first quarter. However, the surplus of 6-7 million EyeQ chips should now be quickly reduced as planned. At the Morgan Stanley Technology, Media & Telecom Conference on March 6, the management confirmed that the EyeQ volume will improve by at least 100% in the following second quarter as planned after around 3.4 million units in the first quarter. This should mean that the majority of the excess stock has already been reduced and a return to normalized levels should take place in the second half of the year.

Total design profits amount to $7 billion, which is 3.5 times higher than the record sales from 2023. Last year, the technologies were already used in 40% of total global car production and, in particular, 8 out of the 10 largest Western OEMs have market shares of 90%. This year, design wins based on the three platforms SuperVision, Chauffeur and Drive have already been won at CES 2024 for a total of 17 new vehicle models that will be launched on the market from 2026. These increasingly complex systems also increase revenue per vehicle with cameras, radar and LiDAR. The goal here is to speed up customers' testing processes in order to keep up with the competition. Further design gains are expected in the second half of the year in particular.

2024 is likely to be a transitional year before a return to growth in 2025. The analysts' consensus forecast for 2024 is revenue of $1.90 billion and net profit of $0.40 per share. An increase to $2.64 billion or $0.77 per share is expected in the following year. The share is now generating the first buy signals again.

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