In this article, we will be taking a look at the 5 best autonomous vehicle ETFs and stocks to invest in. To read our detailed analysis of these stocks and the AV sector, you can go directly to see the 10 Best Autonomous Vehicle ETFs and Stocks to Invest In.
5. Baidu, Inc. (NASDAQ:BIDU)
Number of Hedge Fund Holders: 45
Baidu, Inc. (NASDAQ:BIDU), a Chinese tech company, delved into the AV sector in 2014. The company develops AV software and recently announced that it would be producing Level 4 autonomous cars as well.
Alex Yao, an analyst at JPMorgan, upgraded Baidu, Inc. (NASDAQ:BIDU) shares from Neutral to Overweight on August 31. The analyst also raised his price target on the stock from $160 to $200.
This September, Baidu, Inc. (NASDAQ:BIDU) shares rose in light of the JPMorgan upgrade. Analyst Yao raised his 2022 and 2023 EPS estimates for the company by 20% and 22%, respectively, in light of Baidu, Inc.’s (NASDAQ:BIDU) robust second-quarter results.
Baidu, Inc. (NASDAQ:BIDU) had 45 hedge funds long its stock in the second quarter. Their total stake value was about $2.1 billion.
Horos Asset Management, an investment management firm, mentioned Baidu, Inc. (NASDAQ:BIDU) in its first quarter 2022 investor letter. Here’s what the firm said:
“Although the initial reaction of the Chinese government was passive, it seems that the blacklist published by the SEC, which already includes companies as important as the technology giant Baidu, has shaken things up. Thus, at the beginning of April the CSRC (China Securities Regulatory Commission) announced possible changes in its regulation that would allow this inspection by foreign auditors, provided that the companies previously communicate to this body the state secrets that would be exposed, as well as the sensitive information that they might have to hand over, and the subsequent audit is carried out in a framework of collaboration with the CSRC. In short, a move in the direction desired by the SEC, although still far from the optimal result, that is, unrestricted access to information.
While these negotiations between the two regulatory bodies are progressing, Chinese companies have to decide how best to preserve their interests. In this regard, some companies are already listed on the Hong Kong stock exchange, as is the case of the three major technology companies (Alibaba Group, Tencent Holdings and Baidu).”
4. Micron Technology, Inc. (NASDAQ:MU)
Number of Hedge Fund Holders: 69
Micron Technology, Inc. (NASDAQ:MU) is a semiconductor company manufacturing and selling memory and storage products. The company has been involved in the AV sector for over 25 years, with its memory and storage portfolio enabling automotive applications and AVs.
A Buy rating was reiterated on Micron Technology, Inc. (NASDAQ:MU) shares on August 10, by analyst Sidney Ho at Deutsche Bank. The analyst also placed a $68 price target on the stock.
This September, BofA added Micron Technology, Inc. (NASDAQ:MU) to its list of new ideas in the Alpha Surprise Screen, which ranks stocks in the S&P 500 based on their attractiveness as investments. With a score of one being most attractive, Micron Technology, Inc. (NASDAQ:MU) was assigned a score of 1.5.
Out of 895 hedge funds, 69 funds were long Micron Technology, Inc. (NASDAQ:MU) in the second quarter, compared to 78 funds in the previous quarter. Their total stake values were $2.2 billion and $3.4 billion, respectively.
3. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 72
Tesla, Inc. (NASDAQ:TSLA) is a manufacturer of AVs and EVs, based in Austin, Texas. The company operates through its Automotive and Energy Generation and Storage segments.
Alexander Potter at Piper Sandler kept his Overweight rating on Tesla, Inc. (NASDAQ:TSLA) shares on September 1. The analyst also raised his price target on the stock from $344 to $360.
By the end of this August, battery EV sales were up by 75% on a year-to-date basis. Tesla, Inc. (NASDAQ:TSLA) was the global market leader in these sales, with over 616,000 units sold through July for a 16% market share.
Our hedge fund data shows 72 hedge funds holding stakes in Tesla, Inc. (NASDAQ:TSLA) in the second quarter. Their total stake value was $7.2 billion.
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 84
NVIDIA Corporation (NASDAQ:NVDA) is a semiconductor company providing graphics and computing and networking solutions. The company develops chips for personal vehicles and complete AV commercialization as well.
Needham’s Rajvindra Gill reiterated a Buy rating on NVIDIA Corporation (NASDAQ:NVDA) shares on September 2. The analyst also placed a $170 price target on the stock.
The company’s revenue in the second quarter of 2023 was $6.7 billion, up 3% year over year and beating estimates by 3.47 million. Over the next three to five years, its EPS is expected to grow by 21.8%.
NVIDIA Corporation (NASDAQ:NVDA) was found among the 13F holdings of 84 hedge funds in the second quarter, and 102 hedge funds in the previous quarter. Their total stake values were $3.3 billion and $6.4 billion, respectively.
1. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 153
Alphabet Inc. (NASDAQ:GOOG) was among the first companies to buy into the AV sector. The company’s subsidiary Waymo works with EVs.
On August 3, Ivan Feinseth at Tigress Financial reiterated a Strong Buy rating on Alphabet Inc. (NASDAQ:GOOG) shares. The analyst also raised the price target on the stock from $183 to $186.
This July, Alphabet Inc. (NASDAQ:GOOG) shares jumped in light of the company’s second-quarter results with analysts such as Mark Mahaney at Evercore ISI commenting that the company’s fundamentals held up better than expected. Mahaney also noted that Alphabet Inc.’s (NASDAQ:GOOG) ad revenue grew by 5%.
A total of 153 hedge funds were long Alphabet Inc. (NASDAQ:GOOG) in the second quarter, with a total stake value of $22.3 billion.
Investment management company Arch Capital mentioned Alphabet Inc. (NASDAQ:GOOG) in its second quarter 2022 investor letter. Here’s what it said:
“In May we decided to buy Alphabet Inc. (NASDAQ:GOOG) (parent company of Google, YouTube, and Android). Our thesis was simple. Alphabet has billions of locked-in users around the globe with businesses like Search, Maps, and YouTube that should grow in-line or faster than worldwide GDP. With all the cash these businesses generate, management is able to reinvest in Google Cloud, Other Bets projects like Waymo, and return cash to shareholders via share repurchases. At an enterprise value-to-free cash flow (EV/FCF) of around 20 at the time of our purchase, we believe this sets up shareholders for low risk 15%+ returns over the next five years.”
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