Mobileye: Camera-Assisted Driving

02/09/2015 7:00 am EST

Focus: STOCKS

Chris Versace

Editor, PowerTrend Bulletin, Growth & Dividend Report, and PowerTrader

Despite the drop in gas prices, the auto industry remains committed to long-term fuel efficiency improvements such as Advanced Driver Assistance Systems (ADAS), asserts Chris Versace, editor of Powertrend Profits.

One of the beneficiaries of this development, in my view, is Israel-based Mobileye (MBLY), which designs and develops software and related technologies for camera-based ADAS.

With its camera-based monovision system, Mobileye offers a cost-effective solution that provides the ability for users to drive more fuel efficiently through measures like adaptive cruise control.

Its systems can perform detailed interpretations of the visual field to anticipate possible collisions with other vehicles, pedestrians, cyclists, animals, debris, or other obstacles.

The National Highway Traffic Safety Administration has announced that it plans to add two automatic emergency breaking systems to its list of recommended safety features as a “strong endorsement” that may raise consumer demand.

With customers that include Ford (F), Mazda, and GM (GM) among its 21 auto customers, Mobileye is poised to prosper from not only this regulatory mandate, but also the move toward more safety and reliability features that will drive greater dollar content inside cars and trucks.

The burgeoning market for automated-and-assisted-driving technology should be worth some $25 billion by 2020, compared to $6 billion today.

This backdrop of favorable fundamentals should allow Mobileye to deliver strong top and bottom line growth in the coming years.

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