Jun 24, 2022
[5 min Read]
MicroVision, Inc. develops lidar sensors used in automotive safety and autonomous driving applications. Its laser beam scanning technology is based on micro-electrical mechanical systems, laser diodes, opto-mechanics, electronics, algorithms, and software. The company also develops micro-display concepts and designs for head-mounted augmented reality (AR) headsets, as well as 1440i MEMS module that can support AR headsets; and Interactive Display modules used in smart speakers and other devices.
In order to undergo a comparable analysis (to determine MVIS stocks value), we need to first outline who MVIS's competitors are.
These competitors need to be publicly listed, have valid financial metrics/multiples, operate in a similar manner to MVIS, and have a market cap similar to MVIS (if possible).
By keeping this in mind, I found the following list of companies to be some of MVIS stocks closest competitors:
Overall, MVIS did not perform well financially in 2021 as most of their important metrics (EPS, Net Income, and EBITDA) all shrank by sizable amounts. However, MVIS is a high-growth stock, so maybe their more recent financials will show more growth and a more promising future for MVIS.
Overall, it seems as though MVIS had a poor financial performance as many of their financial metrics shrunk or maintained, most notably their EPS , as well as their net income (by $543,000), and other metrics (as you can tell from the above bullet points).
Additionally, MVIS stock missed their EPS estimate by -$0.01 (or -14.29%), as they reported an EPS of $-0.08 for the quarter (compared to their estimated EPS of $-0.07).
As part of their Q1 2022 earnings release, MVIS stated that they currently have 164.22M Shares Outstanding (weighted average), which is up 0 shares (from 164.22M shares outstanding in Q4 2021). Furthermore, MVIS stock has up to 0 of shares that they can issue (thereby diluting MVIS's stock). This is fantastic news for MVIS investors, as stock dilution does not seem to be an issue/worry here.
Here is the current spread of MVIS stock ratings. In total there are 4 MVIS stock ratings, which fall in the following categories.
Analyst Ratings have provided relatively strong indicators of future price movement, which is why they are used to determine if MVIS stock is a buy or sell. Overall, there are not many analyst ratings out for MVIS yet, however the majority of current ratings are in favor of "buying" MVIS at it's current price.
Overall, MVIS stock is overvalued and needs to experience a change in stock price of (an average of) -56.3% to be considered “at fair value”. However, this may not be quite as bad as it may seem as the financial ratios of MVIS (and their competitors) are highly variable, which makes comparable analyses less relevant. Despite this I still think there is some merit to this prediction based on the fact that MVIS may be overvalued. The question that then remains is "by how much?".
There seems to be an equal amount of positives and negatives when looking at the MVIS stock
Firstly, when looking at the positives, MVIS has no shares that they have diluted over the past quarter, and they have no available shares to issue, thereby diluting the MVIS stock. Furthermore, the majority of analysts are ranking the MVIS stock as a "buy".
Next, when we look at the negatives of the MVIS stock, we notice a lack of good earnings that have been coming from MVIS over the past couple of years. Furthermore, we also know that their financial ratios indicate that they are overvalued.
Overall, it seems as though the negative aspects of MVIS outweigh the positive aspects in this case, which has lead me to take a bearish stance on the MVIS stock.I think that we could see a correction of maybe 10% (rather than the 50%+ achieved via the comparable analysis.