UBS initiates coverage on Pony AI stock with Buy rating, $20 price target

Investing.com - UBS initiated coverage on Pony AI Inc (NASDAQ:PONY) with a Buy rating and a price target of $20.00 on Monday. According to InvestingPro data, the stock currently trades at $13.94, with analyst targets ranging from $15.24 to $26.00.

The price target implies a 53% upside potential from current levels for the autonomous vehicle technology company. While the stock has seen an 11.8% decline over the past week, it maintains strong liquidity with a current ratio of 15.86 and more cash than debt on its balance sheet.

UBS noted that Pony AI is the first and only robotaxi company to start commercial fee-charging and driverless robotaxi operations in all four tier 1 cities in China.

The firm was impressed with Pony AI’s capability in handling complicated road situations without human intervention during test drives in Guangzhou and Shenzhen.

UBS forecasts a 2025-30 sales compound annual growth rate of 96% based on Pony’s robotaxi technology and operating scaling efforts.

In other recent news, Pony AI has made significant strides in the autonomous vehicle sector. The company announced that its Level 4 automotive-grade autonomous driving domain controller has surpassed 2 million kilometers of on-road testing with its seventh-generation Robotaxi fleet. This milestone comes as Pony AI begins road testing its Gen-7 BAIC Robotaxi model in Beijing’s High-Level Autonomous Driving Demonstration Zone. The company is also conducting road tests of its Gen-7 BAIC and GAC Robotaxi models across Beijing, Guangzhou, and Shenzhen.

Pony AI has been granted a permit to provide fully driverless commercial Robotaxi services in Shanghai’s Pudong New Area, marking it as the only company with such permits in all of China’s tier-one cities. Additionally, Shanghai has issued commercial Robotaxi and Robotruck licenses to Pony AI and seven other companies, allowing them to operate across 2,700 kilometers of routes in the city. UBS has initiated coverage on Pony AI with a Buy rating and a $20 price target, noting the company’s pioneering role in launching commercial fee-charging driverless robotaxi operations in China. These developments highlight Pony AI’s expanding presence in the autonomous driving market.

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