Arbe Robotics Ltd Named Bull of the Day by Top Market Analysts

Over the last few trading sessions, we have witnessed the incredible power of the Nvidia (NVDA) halo. The halo refers to the investments made by NVDA in smaller companies that are partners or customers. These partnerships have led to significant stock price movements for the involved companies.

Cerence (CRNC) and NanoX Imaging (NNOX) – Early Beneficiaries

One notable example of the Nvidia halo is Cerence’s partnership with NVDA for large language modeling, which saw its stock jump from $8 before the announcement to a high of $27.50 yesterday morning. Similarly, SoundHound AI (SOUN), another company in which NVDA holds stock, experienced positive stock movements following the announcement.

A New Partnership: Arbe Robotics Ltd (ARBE)

Yesterday, just prior to the Consumer Electronics Show (CES) in Las Vegas, a new partnership was announced between NVDA and Arbe Robotics Ltd (ARBE). The CEO of Nvidia is scheduled to make the keynote address at CES, which marks an exciting beginning for this collaboration.

About Arbe Robotics Ltd (ARBE)

Arbe Robotics Ltd provides D Imaging Radar Chipset Solutions, empowering automakers, tier-1 suppliers, autonomous ground vehicles, commercial and industrial vehicles, and various safety applications with advanced sensing and perception capabilities. Based in Tel Aviv, Israel, the company has shown an impressive growth potential.

Earnings History: A Mixed Bag

When analyzing a stock, one crucial aspect is its earnings history. Arbe Robotics Ltd has had an OK earnings record, with the company topping the Zacks Consensus Estimate in 2 out of the last 4 quarters. However, the most recent earnings print saw the company post a loss of 13 cents when a loss of 11 cents was expected.

Earnings Estimates Revisions: A Positive Trend

Estimate revisions are the core of the Zacks Rank system. For Arbe Robotics Ltd, estimates have been moving higher after the recent miss. The consensus has shifted from a loss of $0.11 to a loss of $0.10 over the last 60 days. Next quarter’s estimate remains at a loss of $0.10, while the full year 2024 estimate has increased from a loss of $0.42 to a loss of $0.40.

Growth Potential: Huge Upside

For the calendar year 2024, analysts have called for revenue growth of 600% to $7M. Although this is a relatively small revenue estimate, the partnership with NVDA could potentially generate hundreds of millions of dollars in future revenues.

Valuation: A Speculative Play

The valuation of Arbe Robotics Ltd is currently skewed to the upside due to its early stage and significant potential growth. As the company is losing money, traditional metrics like PE are not applicable, making it a highly speculative play. Investors would be wise to monitor recent NVDA partners’ moves rather than focusing on valuation metrics.

Daily Trading Chart: Violent Selling

The daily trading chart reveals three major drawdowns in the session. The first sent the stock from $3.85 to $3.50, followed by a drop from $4.40 to $4.00 around 1:00 PM EST, and finally a repeat from $4.50 to $4.00 just before 3:00 PM hour. This highlights that selling can be intense for short periods of time.

Conclusion

The partnership between Arbe Robotics Ltd (ARBE) and NVDA marks an exciting development in the automotive and AI industries. With significant growth potential, a positive earnings trend, and speculative valuation, this company is definitely worth monitoring. As always, investors should conduct thorough research before making any investment decisions.