In this article, we will take a look at the 11 best autonomous vehicle stocks to buy now.
The rising demand for autonomous vehicles transformed the automobile world as we know it. According to Deloitte, by 2040, the sales of driverless vehicles are expected to reach more than 30 million. Some of the biggest electric vehicle companies of today such as Tesla, Inc. (NASDAQ:TSLA), General Motors Company (NYSE:GM), and Ford Motor Company (NYSE:F) are currently in the race to build a fully autonomous vehicle.
According to another report, by 2030, the autonomous vehicle market is expected to reach a value of over $2 trillion. As a result, tech giants such as Alphabet Inc. (NASDAQ:GOOGL), Uber Technologies, Inc. (NYSE:UBER), and Microsoft Corporation (NASDAQ:MSFT) are rushing to capitalize on the demand for artificial intelligence, data, and self-driving technology.
One of the fastest-growing sectors of the industry is industrial mobility. Industrial mobility covers autonomous trucking, factory robots, and public transport systems. Self-driving car company owned by Alphabet Inc. (NASDAQ:GOOGL), Waymo, is one of the current market players in industrial mobility. In June 2021, Waymo raised $2.5 billion in its second external investment round to continue developing its autonomous driving technology. On top of this, Alphabet Inc.’s (NASDAQ:GOOGL) self-driving truck, Waymo Via, is currently partnering with delivery company United Parcel Service, Inc. (NYSE:UPS) to transport goods across the US.
According to a McKinsey & Company article, some of the major catalysts driving increased sales in the autonomous vehicle market include more investments from the Biden administration, such as President Biden’s goal of having half of all new vehicle sales in the United States be zero-emission cars by 2030.
Photo by Samuele Errico Piccarini on Unsplash
Our Methodology
The stocks were chosen and ranked based on the number of hedge fund holdings as of the end of the second quarter of 2021, based on our data of 873 hedge funds.
Best Autonomous Vehicle Stocks To Buy Now
11. Xpeng Inc. (NYSE:XPEV)
Number of Hedge Fund Holders: 19
Xpeng Inc. (NYSE:XPEV) is a China-based electric vehicle manufacturer that makes autonomous driving technology, in-car intelligent operating system, and fundamental vehicle systems.
In 2020, Xpeng acquired the automotive manufacturing company Guangdong Foday Automobile. The acquisition will allow Xpeng to manufacture its automobiles.
By the end of the second quarter of 2021, 19 hedge funds tracked by Insider Monkey held stakes in Xpeng Inc. (NYSE:XPEV) worth roughly $784 million. This is compared to 19 hedge funds in the previous quarter with a total stake value of around $976 million.
10. Luminar Technologies, Inc. (NASDAQ:LAZR)
Number of Hedge Fund Holders: 21
Luminar Technologies, Inc. (NASDAQ:LAZR) ranks tenth on the list of 11 best autonomous vehicle stocks to buy now. The company is a California-based autonomous vehicle sensor and software firm founded in 2012. The company is in partnership with notable vehicle manufacturers such as Daimler Trucks, SAIC, and Volvo.
In 2020, automobile manufacturer Volvo started incorporating Luminar Technologies’ lidar system into its electric flagship SUV, making it the first major automaker to include the technology as standard equipment.
On June 25th, Baird analyst upgraded Luminar Technologies, Inc. (NASDAQ:LAZR) to an Outperform rating from a Neutral rating with a $30 price target, up from $22 per share.
By the end of the second quarter of 2021, 21 hedge funds tracked by Insider Monkey held stakes in Luminar Technologies, Inc. (NASDAQ:LAZR) worth approximately $193 million. This is compared to 12 hedge funds in the previous quarter with a total stake value of roughly $39.2 million.
9. Aptiv PLC (NYSE:APTV)
Number of Hedge Fund Holders: 40
Aptiv is an auto parts company headquartered in Ireland. The company produces autonomous vehicles and systems through Motional, Aptiv’s joint venture with Hyundai Motor Company.
In 2021, Motional introduced its first robotaxi, the all-electric IONIQ 5. The self-driving vehicle will be accessible through the Lyft app on or before 2023. The IONIQ 5 will provide a system for passengers to communicate with the car using an in-vehicle computer, such as directing the robotaxi to make an extra stop.
By the end of the second quarter of 2021, 40 hedge funds tracked by Insider Monkey held stakes in Aptiv PLC (NYSE:APTV) worth approximately $1.67 billion, down from 50 hedge funds in the previous quarter with a total stake value of roughly $1.41 billion.
Oakmark Funds mentioned Aptiv PLC (NYSE:APTV) in its Q1 2021 investor letter:
“Aptiv approached our estimates of intrinsic value and was, therefore, eliminated during the period. The company was longstanding investment of the Fund and produced successful outcomes. We continue to believe that Aptiv is a well-positioned auto supplier that is likely to continue outgrowing light vehicle production for the foreseeable future, but this dynamic is now more fully appreciated by the market.”
8. Ford Motor Company (NYSE:F)
Number of Hedge Fund Holders: 55
Ford Motor Company (NYSE:F) ranks seventh on the list of 11 best autonomous vehicle stocks to buy now. The American multinational automobile manufacturer was founded in 1903 by Henry Ford. Ford manufactured over 4.187 million vehicles in 2020.
In 2020, Ford Motor Company (NYSE:F) announced that it expects to launch its self-driving commercial business in 2022 with vehicles based on the Ford Escape Hybrid crossover. The self-driving vehicle is in partnership with autonomous vehicle start-up Argo AI.
By the end of the second quarter of 2021, 55 hedge funds tracked by Insider Monkey held stakes in Ford Motor Company (NYSE:F) worth approximately $2.10 billion, up from 49 hedge funds in the previous quarter with a total stake value of roughly $2.19 billion.
7. Baidu, Inc. (NASDAQ:BIDU)
Number of Hedge Fund Holders: 59
Baidu, Inc. (NASDAQ:BIDU) is a Chinese internet-related and artificial intelligence company based in Beijing.
The company partnered with BAIC Group’s EV brand ARCFOX to release Apollo Moon. Apollo Moon is a new generation robotaxi that is expected to cost only a third of the cost of average L4 autonomous vehicles.
On September 9, KGI Securities initiated coverage on Baidu, Inc. (NASDAQ:BIDU) with a Neutral rating and a HK$190 price target.
By the end of the second quarter of 2021, 59 hedge funds tracked by Insider Monkey held stakes in Baidu, Inc. (NASDAQ:BIDU) worth approximately $3.47 billion, down from 89 hedge funds in the previous quarter with a total stake value of roughly $6.57 billion.
6. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 60
Tesla, Inc. (NASDAQ:TSLA) is an American electric vehicle and clean energy company that designs and manufactures electric vehicles, household and grid-scale battery energy storage, and related products. The company delivered around 500,000 units in 2020 alone. In June 2021, the company became the world’s first electric vehicle to sell one million units.
By the end of the second quarter of 2021, 60 hedge funds tracked by Insider Monkey held stakes in Tesla, Inc. (NASDAQ:TSLA) worth approximately $9.29 billion, down from 62 hedge funds in the previous quarter with a total stake value of roughly $10.01 billion.
5. Nvidia Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 86
Nvidia Corporation (NASDAQ:NVDA) ranks fifth on the list of 11 best autonomous vehicle stocks to buy now. The company is primarily engaged in the design and manufacturing of graphics processing units for the gaming and professional market. On top of this, the company also develops complete end-to-end solutions for safer, more efficient transportation, including data center infrastructure, software toolkits, libraries, and frameworks.
By the end of the second quarter of 2021, 86 hedge funds tracked by Insider Monkey held stakes in Nvidia Corporation (NASDAQ:NVDA) worth approximately $9.09 billion, up from 80 hedge funds in the previous quarter with a total stake value of roughly $6.20 billion.
Harding Loevner mentioned Nvidia Corporation (NASDAQ:NVDA) in its Q2 2021 investor letter:
“Within IT, shares of US-based computer chip developer NVIDIA continued their climb as rising demand across segments-from work-from-home laptops to data centers to cryptocurrency mining rigs-led to shortages that translated into surging prices for its chips. Such was the windfall that NVIDIA even made technical changes to some of its products to make them towards waht it believes are more sustainable uses. Less attractive to cryptocurrency miners, to steer scarce supply viewed by geography, the lion’s share of excess returns came from good stock performance in the US. In addition to the contributions from NVIDIA and our health care holdings, a pair of IT software and service providers also aided relative returns.”
4. General Motors Company (NYSE:GM)
Number of Hedge Fund Holders: 86
General Motors Company (NYSE:GM) through its majority-owned subsidiary Cruise is expected to start production of the company’s first driverless vehicle in early 2023.
By the end of the second quarter of 2021, 86 hedge funds tracked by Insider Monkey held stakes in General Motors Company (NYSE:GM) worth approximately $7.41 billion. In line with the previous quarter with 86 stakes and a total stake value of roughly $8.05 billion.
3. Uber Technologies, Inc. (NYSE:UBER)
Number of Hedge Fund Holders: 135
In 2020, Uber Technologies, Inc. (NYSE:UBER) invested $400 million in the self-driving company Aurora. The company is expected to license Aurora’s manufacturing technology.
On September 13th, Goldman Sachs analyst Eric Sheridan initiated coverage on Uber Technologies, Inc. (NYSE:UBER) with a Buy rating and a $64 price target. The analyst believes that given the company’s magnitude of user and economic capture, it may be the next large-cap platform ecosystem.
By the end of the second quarter of 2021, 135 hedge funds tracked by Insider Monkey held stakes in Uber Technologies, Inc. (NYSE:UBER) worth approximately $10.41 billion.
RiverPark Funds mentioned Uber Technologies, Inc. (NYSE:UBER) its its Q2 2021 investor letter:
“UBER was our top detractor for the quarter. Delivery growth remains strong, and ride sharing has started to recover, though still down year over year (vs. pre-COVID results). Gross bookings grew 24% year over year, driven by 166% Delivery growth.
Despite the COVID disruption, UBER remains the undisputed global leader in ride sharing, with greater than 50% share in every major region in which it operates. The company is also a leader in food delivery (64% of 1Q21 revenue), where it is number one or two in the more than 25 countries in which it operates. We view UBER as more than just ride sharing and food delivery, but also as a global mobility platform with the ability to sell to its more than 100 million users (by comparison, Amazon Prime has 130+ million members) and penetrate new markets of ondemand services, such as grocery delivery, truck brokerage and worker staffing for shift work. Its New Verticals (non-food delivery such as grocery, convenience, and alcohol) business hit a $3 billion annualized run rate in March, up 77% quarter over quarter.
UBER, at its current $91 billion market capitalization, trades at 4x next year’s revenue from its two core businesses. Additionally, the company has substantial, unrecognized, value in its several nascent development businesses and another $13 billion in equity stakes in synergistic businesses around the world.”
2. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 190
Ranking second on the list of 11 best autonomous vehicle stocks to buy now is Alphabet Inc. (NASDAQ:GOOGL). Alphabet Inc. (NASDAQ:GOOGL) is notable for its multinational internet-related services and products.
The company operates its autonomous vehicles segment through its sibling company Waymo. Earlier this year, Waymo raised $2.5 billion in an investment round to develop its autonomous driving technology.
On October 1st, RBC Capital analyst Brad Erickson initiated coverage on Alphabet Inc. (NASDAQ:GOOGL) with an Outperform rating and a $3,400 price target. The analyst mentioned his bullish checks on the company’s core search business’s long-term pricing potential, as well as YouTube’s market share gains.
Mawer Investment Management mentioned Alphabet Inc. (NASDAQ:GOOGL) in its Q2 2021 investor letter:
“Many higher growth companies reported strong results amid the pick-up in broad economic activity including Alphabet. These higher growth companies tend to have increased sensitivity to a change in discount rates and were supported as long-term interest rates stabilized over the period.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 238
Topping the list of 11 best autonomous vehicle stocks to buy now is Microsoft Corporation (NASDAQ:MSFT). Microsoft is known for its computer software, consumer electronics, and personal computers. The company was founded in 1975 and based in Washington.
Microsoft Corporation (NASDAQ:MSFT) entered a partnership with Volkswagen Group wherein the company will produce a dedicated cloud-based platform for future autonomous car systems.
On September 17th, Tigress Financial analyst Ivan Feinseth maintained a Buy rating on Microsoft Corporation (NASDAQ:MSFT) and raised the price target to $366 from $303 per share.
By the end of the second quarter of 2021, 238 hedge funds tracked by Insider Monkey held stakes in Microsoft Corporation (NASDAQ:MSFT) worth approximately $62.46 billion.
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Disclosure: None. 11 Best Autonomous Vehicle Stocks To Buy Now is originally published on Insider Monkey.
