Asia tech stocks slide tracking Wall St losses amid AI doubts, govt. uncertainty
Investing.com -- Bank of America upgraded Mobileye to Neutral from Underperform on Monday, citing reduced downside risks and potential catalysts in 2025.
“We upgrade Mobileye (MBLY) to Neutral from Underperform,” BofA analysts wrote, noting that while earnings growth may take until 2027 to inflect positively, upcoming contract wins could support sentiment.
Mobileye’s 2025 guidance came in below both BofA and consensus expectations, reinforcing concerns about near-term growth.
However, BofA sees this as setting a lower bar, limiting downside risk to estimates. “Our discussions with investors also suggest sentiment is bottoming,” analysts stated, adding that contract negotiations with multiple automakers for its SuperVision and Surround ADAS technology could provide a boost this year.
BofA raised its price target for the stock to $19 from $12, driven by long-term valuation analysis. The firm expects ADAS adoption to steadily expand through 2040, while advanced autonomous vehicle (AV) products, such as Mobileye’s Chauffeur and Drive systems, will gain market share gradually.
“We assume it could take well into the 2030s for SuperVision and Chauffeur to become more readily available on vehicles in NA and Europe,” BofA wrote.
While earnings growth in 2025 and 2026 is expected to be limited, the firm anticipates a positive inflection in 2027 as incremental SuperVision volumes start to ramp up.
“MBLY could announce as many as two to three contract wins in 2025 that would provide meaningful volumes,” BofA noted, highlighting potential deals with automakers in Japan, Europe, and the U.S.
Despite ongoing competition in the AV sector, BofA believes Mobileye’s positioning could improve if it secures major SuperVision/Chauffeur contracts. “We think a SuperVision/Chauffeur win would be particularly meaningful,” the analysts added.