Mobileye (Nasdaq: MBLY) founder and CEO Amnon Shashua has expressed his confidence in the stock after its steep fall. According to a report filed with the SEC yesterday (Monday), Shashua bought Mobileye shares on Friday to the tune of $10.4 million, at prices ranging between $15.5 and $17. Altogether, Shashua bought some 632,000 Mobileye shares.
Israeli company Mobileye develops and produces ADAS (advanced driver assistance system) solutions.
As the share price of its parent company Intel collapsed on Friday, Mobileye completed a painful 24% plunge in the last two sessions of last week. This followed the release of Mobileye’s second quarter financials, and a cut to its 2024 guidance. The ADAS (advanced driver assistance systems) technology company, headed by its founder Amnon Shashua, disappointed the market with its revised guidance, and its share price fell well below its IPO price.
Intel floated Mobileye on Nasdaq in late 2022 at a price of $21 per share, valuing the company at $17 billion. It closed yesterday at $15.18, giving it a market cap of $12.2 billion, although the share price rose 4.3% in later trading.. Furthermore, since its peak, in February 2023, Mobileye’s share price has fallen by 66%. After a long period in which it was the most valuable Israeli company on Wall Street, Mobileye has been overtaken by cybersecurity company Check Point and by drug company Teva.
Mobileye now sees revenue of $1.6-1.68 billion for 2024, 21% less than in 2023, and down from $1.83-1.96 billion in its earlier guidance. The annual operating loss is expected to be $531-580 million, and adjusted net profit is forecast to be $152-201 million.
The trend in Mobileye’s share price has been negative since the beginning of this year. At the end of last week, an SEC filing revealed another cause of the pressure on the stock in recent months: Norwegian bank Norges Bank has sold more than half its holding in Mobileye since April.
At the end of July, the bank held 5.2% of Mobileye’s A shares, which compares with 10.7% in mid-April. The bank was one of the anchor investors in Mobileye’s flotation.
Commenting on the second quarter results, Shashua said, "We are glad to report that the excess inventory at Tier 1 customers that meaningfully impacted our business in the first half of 2024 appears to be almost fully behind us, but a more significant than anticipated softening of business conditions in China (affecting the industry as a whole) is expected to lead to challenges in the second half... Our main focus for the remainder of 2024 is to successfully execute our current advanced programs and to convert the unprecedented opportunity set we are currently pursuing into series production awards."
Published by Globes, Israel business news - en.globes.co.il - on August 6, 2024.
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