Mobileye is an undervalued leader in autonomous tech with strong OEM relationships and backlog, expected to have a larger future role than currently priced in.

The first one I want to start with is Mobileye. Mobileye is the leader in autonomous technology on vehicles today, level one and low-end level two autonomous technology that you may have in your vehicles.

This is the smart cruise, smart follow, lane assist. These products have essentially become industry standard, and Mobileye is the leader providing the chips and software for both 30 million vehicles annually.

The company generates about $2 billion a year in revenue and generated $388 million in free cash flow over the past year. So this is a leader in the industry but being very overlooked by investors today.

But there's reason to think that Mobileye may play a big role in the autonomous future. They They have relationships with some of the biggest automakers in the world, mainly Volkswagen, who is the largest automaker.

Their biggest partnership is with Volkswagen but they also recently signed a deal with one of the biggest automakers in the US. They have billions of dollars worth of backlog and visibility, not only moving those companies up to level two and level three autonomy, but also building level four autonomous vehicles themselves through a partnership with MOIA, a subsidiary of Volkswagen.

And this is a company that is testing vehicles in Austin, Texas, just like Tesla is doing with the cybercab. But unlike the cybercab, this is multi-sensor, so there are levels of redundancy.

And Mobileye is doing similar testing in Europe as well.

Now the advantage for Mobileye is they're hooked into all of these OEMs already. They don't have to build these vehicles themselves, although they are potentially testing that for early robo-taxis where they're going to design the vehicle and actually launch it themselves to basically push the industry forward similar to what Tesla did except they already have those relationships to be a modular supplier as robo-taxis begin to scale.

And so think about if you're a company like Ford or Stellantis. You're interested on autonomous vehicles, you don't have the technology built yourself. Who do you go to get that technology off the shelf? Mobileye is already a trusted supplier.

I think they're going to play a much bigger role in the future of autonomous vehicle than a lot of people think because they're behind the scenes and they're working with the big established players.

These are companies that you don't want to overlook and the opportunity for Mobileye is to go from a system that only cost about $50 per vehicle to potentially thousands of dollars per vehicle.

And in robo-taxis, they could be taking a cut of every single ride that's done with Mobileye's technology.