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Mobileye On The Prize, Dick’s Digs Deep & Google’s Mandiant Mashup

Mobileye On The Prize, Dick’s Digs Deep & Google’s Mandiant Mashup

Intel taking Mobileye public

The Mobileyes Have It…

Mobileye of a hurricane, listen to Intel churn. The market serves its own needs. Don’t mis-serve your own needs. Volatility it up a notch, speed, grunt, no, strength…

All right, Mr. Great Stuff, are you implying it’s the end of Intel as we know it?

Maybe? I know I’m exaggerating a little bit here — OK, probably more than a little bit — but Intel (Nasdaq: INTC) taking Mobileye public is a pretty big deal.

Remember the last time we talked about Mobileye going public? No? Come on, I even wrote a sea shanty about it. Geez…

What I'd miss keep Greatness flowing meme

Anyway, the important bits are that Mobileye specializes in AI and autonomous vehicles. The company’s main technology revolves around lidar, or Light Detection and Ranging.

This nifty bit of tech bounces freaking lasers off your surroundings to help your AI-driven car move around all by its lonesome.

Intel bought Mobileye for $15.3 billion back in 2017 to get in on the self-driving car market. Since then, Mobileye has averaged annual revenue growth of 24%, banking $967 million in revenue in 2020.

As of today, all that speculation is now official. As Barron’s reports, Intel “filed confidentially” with the SEC to take Mobileye public.

Confidentially? You keep using that word. I don’t think it means what you think it means. I mean, I know when I file things “confidentially,” I like to tell major financial publications all about it.

In fact, be sure to read all about my confidential tax filing next month on CNBC’s Squawk Box. Not really…

Anywho, now that it’s all official-like, there are two important things you need to know about the coming Mobileye IPO:

1. Back in December, Wall Street analysts suggested that Mobileye’s IPO could bring in $50 billion. At the time, New Street Research Analyst Pierre Ferragu said that a $50 billion valuation “makes sense to us.”

But times have changed a lot since December, especially with how Wall Street values growth companies … especially tech growth companies. Mobileye’s public offering will be nothing short of a major litmus test for how willing investors are to take a chance on an IPO under current market conditions.

I would venture to say that Mobileye’s IPO could set the tone for the IPO market for the rest of the year. I know I’ll be paying very close attention to this particular listing.

2. A successful Mobileye IPO will be a major boon for Intel. It’s no secret that Intel needs cash to ramp up chip manufacturing — AMD is eating Intel’s lunch in several markets, and the former king of chips needs this cash infusion for more manufacturing capacity in a bad way.

I see the Mobileye IPO as a bullish move by Intel. How bullish depends on how much money the IPO brings in. At December’s valuation of $50 billion, that gives Intel more than enough capital to fund its $20 billion construction of two new chip plants in Arizona.

Furthermore, Intel will retain majority ownership of Mobileye. That means more cash for Intel as Mobileye’s growth accelerates. And accelerate it will, as Intel expects Mobileye’s revenue to jump 40% this year. Who says you can’t have your cake and eat it too?

Now, you might be wondering why you should care about Mobileye.

Well, the company’s lidar and AI offerings are in an estimated 45 million to 50 million vehicles worldwide. It’s not Nvidia (Nasdaq: NVDA) levels of AI dominance, but the mere fact that you can put Mobileye in the same sentence as Nvidia when talking about AI is a big deal all in itself.

Lidar & AI estimated 45 to 50 million vehicles worldwide.

Finally, while I’m still reluctant to invest in Intel directly — the company has to prove it can ramp up production and compete with AMD’s superior offerings — I’m very excited about the Mobileye IPO.

Y’all Great Ones know I don’t like to buy IPO stocks on day one due to the hype surrounding such events.

But with Mobileye going public in the midst of one of the most volatile and uncertain markets I’ve seen since 2008 … the possibility of picking up Mobileye stock at a massive discount to what it should be trading at makes this IPO very tempting indeed.

Mobileye … we’re watching you. Seeing your every move. (Watching you! Watching you!)

Editor’s Note: You Can’t Hide Your Lidar Eyes

If you’re still — still — looking for a way to invest in the lidar market but can’t bring yourself to wait until Mobileye’s IPO, I’ve got just the thing to tide you over.

Almost every other carmaker is betting on this one company to bring lidar tech into the limelight: Audi alone is investing $16 billion … GM, $27 billion through 2025 … BMW, $35 billion.

Click here to see what all the hype is about.  
Good, Better, Best

Good: Petco’s Plans Pay Off

Petco posted positive earnings

I was just about to regale y’all Great Ones with a rip-roaring rendition of Baha Men’s “Who Let The Dogs Out” … but managed to rein myself in at the last minute. I do have some control over the crazy, you see.

As you’ve probably already guessed from that headline way up yonder, we’re pimping Petco (Nasdaq: WOOF) out in these here virtual pages today.

The veritable playground for pooches and all other manner of pets, Petco posted positive earnings of $0.28 per share on quarterly revenue of $1.5 billion. For context, that’s a 13% revenue increase year over year, with earnings coming in $0.03 ahead of analysts’ expectations.

For Petco’s part, this marks the seventh consecutive quarter of double-digit growth, which can be linked back to the company’s decision to focus on “whole pet” care.

Essentially, Petco’s become a one-stop shop for good boys and girls everywhere, with locations now including in-store vet hospitals and clinics in addition to food, toys and those massive glass tanks only die-hard “fish people” buy … of which I may or may not own one … or two … or six.

Clearly, you’ve not met the snake people.

Sneks? No s-s-s-s-s-s-s-iree, Bob! I’ll stick to dogs, cats and fish, thank you very much. Though now I’m kinda curious: Do any of you Great Ones have any “unusual” pets … or pet-related investments?

If so, let me know: GreatStuffToday@BanyanHill.com.

Better: Dick’s’ Slam Dunk

Dick's DKS reports high earnings

Dick’s Sporting Goods (NYSE: DKS) knocked it out of the park with its latest earnings report — and the Wall Street crowd went wild!

Daring with the sports metaphors today, I see.

Well, analysts went about as wild as anyone can get these days for a company trading outside of the energy sector … but that’s a conversation for a couple minutes from now. (Oh, the suspense is killing me!)

Dick’s did so well this last quarter — how well did it do?! — that the company’s raising its quarterly dividend by a cool 11%. Earnings for the last three months came in at $3.64 per share compared to Wall Street’s target of $3.43 per share. Revenue also roared to $3.35 billion, beating expectations.

According to Dick’s, plenty of customers are still buying outdoorsy stuff and exercise equipment post pandemic, even though public gyms are open again for people to go pose for Instagram get swole in.

However, despite Dick’s’ slam dunk delivery and its strong forward-looking guidance, the company stressed caution over upcoming consumer demand should prices for … well, everything continue to climb.

Given the choice between paying for gas and groceries and getting that shiny new stationary bike, any rational person is gonna nab their weekly necessities first. Right…?

While Dick’s stock is rallying a rewarding 5% on today’s news … DKS investors still need to exercise caution over sky-high inflation.

Best: Google’s Gone Phishing

Google drops $5.4 billion on cybersecurity

And just like that, the game of cybersecurity catch-up … is on.

In its never-ending fight to show you it’s super-duper serious about digital security, Alphabet’s (Nasdaq: GOOGL) Google went out and dropped $5.4 billion to snatch up one of the best dang cybersecurity firms around: Mandiant (Nasdaq: MNDT).

Ah, yes, the Mandiant! Like from the Boba Fett show?

What? No. Not even close. This is Mandiant … but I guess it’s kinda like a Mandalorian, the way the company hunts down cyberthreats.

This is the way.

This is the way.

Ahem. Mandiant used to be a part of FireEye’s cybersecurity umbrella — the other all-seeing eye — which in turn helped Microsoft uncover the SolarWinds hack.

Basically, Mandiant is up there with the cream of the cybersecurity crop. And according to Wedbush Analyst Dan Ives, Google’s cyber shopping might put the rest of Big Tech in buyout mode:

With cyber attacks increasing by the day and cyber warfare underway from Russia/state sponsored cyber terrorism organizations, Google is doubling down on its cyber security footprint at the right time with Mandiant and looking to differentiate itself from the likes of behemoths Microsoft and Amazon in the cloud arms race.

Well, I should certainly hope so.

If Big Tech is hardly equipped to counteract modern cyberthreats, how do you think they’re going to stand up to meta threats?

Meta threats? Like … even worse Facebook ads?

Oh … worse! Just imagine for a sec: More and more of our personal data is stored on the cloud these days, right? This far-off digital ether that somehow can hold your vacation pics and random docs you forgot?

That’s nothing compared to the massive amounts of data needed to create (and store) the ever-online virtual worlds of the metaverse. And if the Googles and Metas and Amazons of the world want to create a brave new digital world … they’re gonna need brave new security to go with it.

With unprecedented tech comes unprecedented security threats — such is the everlasting constant of the digital world. Spam, scams … and scammy spam. (The worst kind!)

Quote of the week

The average regular U.S. gasoline price soared to a record high on Tuesday, hitting $4.173 per gallon, according to AAA. The record, which isn’t adjusted for inflation, comes as Russia’s unprovoked invasion of Ukraine continues to disrupt the markets and drive up energy costs. — Axios

high gas price record

Called it.

Anyone else take yesterday’s bet on breaking the gas price record?

You should’ve … but which of you bet we’d get past 2008’s notch of $4.11, like, in a matter of hours?

If you wanna play psychic (again), tell me in the inbox: How long till we get off Mr. Oil’s wild ride completely and go green?

Or, click here to go down the energy rabbit hole for yourself…

We’re all mad about alt energy down here … or something like that. Once you’ve checked that out, here’s where else you can find us across the interwebs:

Until next time, stay Great!

Regards,
Joseph Hargett. Editor of Great Stuff

Joseph Hargett
Editor, Great Stuff

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