Shares of Luminar Technologies (LAZR) jumped on Friday after the company provided an update on its business, 2021 milestones and preliminary 2020 results, and announced a strategic agreement with China's SAIC Motor.
SAIC PARTNERSHIP: Earlier on Thursday, Luminar announced a strategic partnership with SAIC Motor, one of China's largest automakers. Under the terms of the deal, SAIC plans to use lidar sensors and software made by Luminar Technologies to enable autonomous capabilities in a new “R brand” line of vehicles, the companies said. The R brand program is expected to begin series production with Luminar starting in 2022, with the parties’ longer-term goal being widespread standardization across all vehicle lines, Luminar added. The partnership is expected to deliver the first autonomous production vehicles in China, it further noted.
Luminar CEO Austin Russell told CNBC that the companies’ longer-term plan is to standardize the system so it can be included in a wide array of SAIC vehicles.
PRELIMINARY 2020 RESULTS AND 2021 GUIDANCE: Luminar said it expects revenue for fiscal 2020 to be approximately $14M, against three consensus estimates of $15.13M. The forward-looking order book exceeded original guidance of $1B and met updated guidance at just over $1.3B, Luminar said.
Looking to 2021, Luminar sees revenue of $25M-$30M, against analysts' estimates of $26.87M. The company is looking to increase its forward-looking order book by 40%+ and expects gross cash spend of approximately $140M, which includes capital expenditures of approximately $10M-$15M for the year.
BUSINESS UPDATE: In a business update, Luminar said it has successfully completed engineering validation testing of Iris, progressing onto the final stages of B-samples before ramping into C-sample phase later this year. Luminar has selected a contract manufacturer for continued, efficient series production of Iris in a Mexico production facility, it said.
Founder and CEO Austin Russell said "Luminar’s 2020 achievements reflect our product leadership and market ownership as we continue to execute and fulfill the vision of making safe autonomy a reality. Our successful debut as a public company has helped to further accelerate the expansion of our product roadmap in addition to commercial growth across passenger vehicle OEMs, trucking partners, and robo-taxi programs. This is validated by our latest major wins with SAIC and Zenseact, and we look forward to continuing to execute."
INITIATED WITH A HOLD: On Friday, Craig-Hallum analyst Richard Shannon initiated coverage of Luminar with a Hold rating and $24 price target. Shannon told investors in a research note that while Luminar is likely to win near-term contracts that require its long-range solution, as other solutions come into market, he has doubts about its efficacy given scalability/performance/cost barriers.
WHAT'S NOTABLE: Luminar went public in December via a merger with a SPAC. On December 8, Andrew Left's Citron Research predicted via Twitter that "suckers game" Luminar shares will back to $20. The firm, known for its short-selling ideas, said it would rather own "industry leader" Velodyne Lidar (VLDR). Citron expects Velodyne shares will rally to $30. It tweeted: "$LAZR at $14 bil ($40) is not even a casino stock...you can actually win at a casino..it is more of a "suckers game" Would much rather own industry leader $VLDR at less than $4 bil mkt cap. Citron expects $LAZR back at $20 and $VLDR at $30."
PRICE ACTION: At midday, shares of Luminar Technologies are up $3.56, or 13.5%, to $29.86.
