Why did Innoviz shares surge 60% this week?
Bullish analysts expect the Israeli LiDAR developer’s stock to climb significantly, suggesting even a massive 500% upside
Shares of Israeli LiDAR developer Innoviz have climbed 60% since Monday. The main reason for the rise seems to be a report published by CNBC on Sunday in which several analysts, including from JPMorgan and Berenberg, suggested that the company’s stock could climb by over 500%.
“We expect large volume wins, balance of LiDAR costs and performance, and ability to support highway autonomy to position Innoviz to ramp revenues well through the end of the decade,” a JPMorgan analyst told CNBC.
JPMorgan suggested a $13 target for Innoviz shares, which entered Friday trading at $2.88 after beginning the week at $1.80. Berenberg’s expert put the target figure at $12, while a WestPark Capital analyst was less bullish, but still suggested a target of $10.
Last month, Innoviz published its results for Q3 2023, with revenues hitting $3.5 million, up 138% compared to revenues of $1.5 million in Q2 2023 and up 297% compared to revenues of $0.9 million in Q3 2022. The 138% quarter-over-quarter increase in revenues was driven by strong growth in InnovizTwo unit sales, which increased 102% sequentially, coupled with incremental NRE revenue.
Operating expenses in Q3 2023 were $27.8 million, a decrease of 11% compared to operating expenses of $31.3 million in Q3 2022. Operating expenses for Q3 2023 included $5.0 million of share-based compensation compared to $4.9 million of share-based compensation in Q3 2022.
Liquidity as of September 30, 2023 consisted of approximately $163.8 million in cash and cash equivalents.
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"With our transition from SOP preparation to steady state manufacturing advancing day by day, we are shifting even more of our focus towards winning the next rounds of series production awards," said Omer Keilaf, Innoviz Co-Founder and CEO. "We continue to believe the LiDAR market will ultimately be a 'winner takes most' industry, and that the next few deals could provide us with additional momentum."
Keilaf added, "While the tragic events that have taken place in Israel over the past month have affected us all on a personal level, our global business has continued to operate as planned. Our international manufacturing operations in Germany, the U.S. and Asia were unaffected, and operations at our Israeli headquarters quickly normalized, aided by detailed business continuity planning coupled with a tremendous level of determination and commitment from the Innoviz team. It is in these trying times that we lift our heads and persevere."
