Luminar Technologies

I took a New Year’s break from my usual output, but I’m back now. China’s stocks since being battered till the end of October, 2022 are rebounding well. KWEB 0.58%↑ is up nearly 12% in the last month. BABA 0.63%↑ is up nearly 18% in the same period. With the reset of TSLA 4.52%↑ before the rally we saw on Friday, Tesla, which is one of the best growth stocks, was down nearly 37% in the last month. This tanked other related EV stocks and also the LiDAR stocks I follow. I believe the market leader in that space is Luminar LAZR 3.32%↑ . Hard to believe the stock has corrected this much, and where it is worth buying now? It’s down a whopping 44% in the last month and 2023 looks nearly as bad or worse for tech stocks of this nature, as did 2022. But just like Shopify and the others, at a certain point they become on a bargain discount. That’s not to say Austin Russell doesn’t have challenging weeks and months ahead. The march of the robo-taxis has not been smooth at all, with progress halted or nearly in stagnation at a certain point. The market seems to be kinder to Intel’s Mobileye that went public recently MBLY 4.45%↑. While Mobileye has a market cap of $25 Billion, Luminar to a $1.43 Billion. Whether this is or not justified isn’t just the point, it’s that if this is the company that’s the market leader in LiDAR sales, it could develop into an important company, eventually. Tesla’s fall has dragged many companies I am bullish on down near the gutter, take XPEV 1.46%↑ for instance, it’s neither here nor there with discount EVs vs. Luxury EVs. But Xpeng has further to fall before a buy call from me than Luminar. But how low could Luminar go, my guess is a price point of about $1.80 (based on the data from the stock price in Excel. All of these EV and LiDAR stocks correct as Tesla’s shorts have their field day finally. If we were to try to find bright spots in the carnage, I think Luminar’s customer orders could be one of them. Luminar Tech. confirmed the Lidar sensor company achieved a 60% boost for the forward-looking order book. Luminar Investor Earnings Luminar just isn’t making a lot of revenue yet, and it’s not clear in the 2023 climate when it actually will. How do you believe in a company whose financials look like this? With a robo-taxis revolution at play, many of the LiDAR startups look totally doomed. Luckily this company still has more than half a Billion in cash. Luminar raised $1 Billion before they went public. Luminar however is part of the SPAC cohort of 2020, some of the worst beaten up stocks imaginable. In December 2020, Luminar began trading publicly after a SPAC IPO through Gores Metropoulos Inc. — with a post-deal market valuation of $3.4 billion. It was a great time to think you deserved to go public. It doesn’t matter how cheap the stock is if you aren’t making and growing revenue at an incredible clip. I’ll still remember the bubble of MVIS 2.86%↑ one of the worst bubbles I've ever seen even for a penny stock. Without thousands of drones, robots and smart cars, the demand for LiDAR is still just not that big for dozens of startups dedicated to the technology. Robo-taxis were so hyped, investors were desperate to get in on the next FOMO hype cycle. But a lot of hype cycles have come and gone and we’ve learn a thing or two in those days, and in what the new normal means for NASDAQ beaten up growth stocks, with potentially zero future. Revenue is growing, but so are the losses, never a good sign: 2023 will chew you up if you can’t actually grow revenue fast enough with sky-high interest rates. Most of the SPACs may as well be zombie companies at this point. Luminar is now shipping lidar units to SAIC Motor, China’s largest automaker, ahead of schedule, said a November, 2022 article. The company’s Iris lidar units will also be featured on upcoming new models from Polestar and Volvo, two of the best value stocks on the market right now. Someone may have to acquire this company to save it, if I had to be bleak about the financials. “After 10 years of innovating, prototyping, developing, industrializing, all this stuff, we’ve finally hit the big inflection point,” CEO Austin Russel Sadly the numbers just don’t back up what Austin was trying to say. Luminar’s vision is to make autonomous transportation safe and ubiquitous. As a global leader in lidar autonomous driving technology, they are seeking to enable the world’s first autonomous solutions for automotive series production in passenger cars and commercial trucks. Until more proof of real revenue, I cannot in good conscience recommend the stock as Tesla’s valuation keeps getting slashed to bits. Having great future plans doesn’t quite feel the same in the early to mid 2020s. The company has deals with SAIC and Volvo launching within the next year. The Rising Auto R7 is already in production while the Volvo EX90 was recently unveiled and launches next year with the Luminar Iris Lidar as a standard option. The problem is the way they project future guidance sounds looks dubious compared to the trajectory of actual revenue. The order book is now at least $3.4 billion for an impressive $1.3 billion increase last year. Importantly, this order book covers just the next 4 years through 2026. As you can imagine, most LiDAR stocks in their peer SPAC cohort, have been totally demolished. Mobileye is a much better company than Luminar (that looks too risky in the first half of 2023). This is not the conclusion I was hoping to come to, as I rummage in the rubble of what are now penny stocks among some of the growth names I’ve been following since the pandemic. I still think the Tech Bust has some hidden treasures, but they are becoming more difficult to identity. I think we’ve all been somewhat humbled by the volatility and the lastest correction to the mean makes January to March 2023 look among the bleakest I’ve seen. It turns out anticipating a coming Recession is nearly as bad as being in one, if stagflation, pandemic buyer’s remorse and mounting credit card debt is becoming an issue. After the collapse of SBF, there’s a certain gleam in Austin’s eyes that’s freaking me out. Maybe the young prodigies deserve our mistrust and at least a healthy skepticism. Because the collapse of the robo-taxis hype, from false advertising about Tesla’s FSD to how slow Waymo and Baidu are moving, makes me seriously wonder about the future of LiDAR. Even Apple’s smart car keeps getting pushed back more years. It’s doom and gloom for so many tech stocks that have lost 70% of their market cap. But for growth stocks, it’s do or die time in 2023. 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