It’s surely a great time to be an investor, especially when new investing trends in medicines to communication are starting to have an effect. One of the most promising new trends is the intersection of transportation, computers and clean energy in the form of autonomous electric cars.
Let’s face it, almost 1 billion passenger cars are on the roads worldwide and a lot of gasoline is burned and carbon is emitted on a daily basis. Green Car report, by the way, expects that to even double by 2025. Autonomous or self-driving cars, thus, are making great inroads as it reduces carbon emission.
Some skeptics may not trust a computer to navigate the vehicle that they are in. However, around 40,000 people die in the United States each year due to car crashes. Driverless cars are expected to bring that number down.
And that’s the reason why several top-notch companies are pouring billions of dollars into the autonomous driving technology. Needless to say, it will increase productivity and savvy investors should do well to cash in on this booming trend. That’s why we are bringing you the best stocks to play the autonomous vehicle revolution.
Watch Out for Cruise
General Motors Company GM acquired Cruise for nearly $1 billion. Softbank and Honda also invested in General Motors-acquired Cruise and the valuation surged to $14.6 billion.
Cruise has given General Motors a worthwhile commercial autonomous taxi option for the near future. Self-driving technologies like Super Cruise in General Motors’ Cadillac category has proven to be a grand success.
General Motors recently issued a strong guidance for the current quarter and fiscal 2019. General Motors currently has a Zacks Rank #2 (Buy). In the past 60 days, seven earnings estimates moved north, while none moved south for the current year. The Zacks Consensus Estimate for earnings rose 11.3% in the same period. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
This company that designs, builds, and sells cars, trucks, crossovers, and automobile parts worldwide has outpaced the Automotive - Domestic industry so far this year (+19.5% vs +8.1%).
Waymo Going Mainstream
Investors should see upbeat results from Alphabet Inc.’s GOOGL other business lines, including the self-driving car unit. Waymo, a unit of Alphabet, launched its first driverless-car service in Arizona last December and vowed to proceed “carefully” with the technology.
In the future, Waymo will “gradually roll out” the driverless car program and the early-rider program will continue. The early-rider program included more than 400 Phoenix-area residents signing up last year to test drive driverless cars in their neighborhood.
Last month, Waymo announced plans to build a 200,000-square-foot facility in Michigan, thereby manufacturing the world’s first factory dedicated to mass production of self-driving cars.
Alphabet currently has a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for its current-quarter earnings has moved up 0.5% in the past 30 days.
The company’s expected earnings growth rate for the current year is 8.4%, in contrast to the Internet - Services industry’s projected decline of 1%. The company has outperformed the broader industry in the past year (+0.9% vs -19.5%).
Intel’s Future in Autonomous Driving Space
Intel Corporation INTC doesn’t have its own autonomous driving platform. But, the company’s $15.3-billion acquisition of Mobileye helped it build chips required for self-driving systems. Intel has agreed to supply EyeQ5 chip in 8 million driverless vehicles for a European automaker. Lest we forget, Intel’s reactionary system for autonomous driving, Responsibility-Sensitive Safety program (RSS), minimizes risks.
Intel currently has a Zacks Rank #3. In the past 60 days, four earnings estimates moved north, while two moved south for the next year. The Zacks Consensus Estimate for earnings rose 1.9% in the same period.
The company has outperformed the Semiconductor - General industry in the past year (+12.2% vs -5.9%).
BlackBerry: Automotive Software Security Pick
BlackBerry Limited BB is an enterprise software and security company. It is present in millions of vehicles and has collaborations with some of the world’s largest automakers. And when autonomous driving will hit the markets, security will surely be one of the major concerns for automakers. Thus, BlackBerry is in a solid position to make the most of the autonomous driving boom.
BlackBerry currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has moved up 23.1% in the past 90 days.
The company’s expected earnings growth rate for the current year is 14.3%, more than the Wireless Non-US industry’s gain of 6.6%. The company has outperformed the broader industry on a year-to-date basis (+19.9% vs +5.1%).
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
See their latest picks free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Alphabet Inc. (GOOGL) : Free Stock Analysis Report
General Motors Company (GM) : Free Stock Analysis Report
Intel Corporation (INTC) : Free Stock Analysis Report
BlackBerry Limited (BB) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research