Mobileye (MBLY) Stock Drops on Tesla Split

Mobileye (MBLY) stock is plummeting in early morning trading today after the company announced it would no longer work with Tesla (TSLA).
By Annie Palmer ,

NEW YORK (TheStreet) -- Shares of Mobileye (MBLY)  are down 8.58% to $45.09 in early morning trading today after the Jerusalem-based technology company announced it would no longer supply sensor chips to electric car maker Tesla Motors (TSLA). 

Mobileye said its relationship with Tesla "will not go beyond EyeQ3 chip as it seeks closer collaborations (like BMW/INTC) as opposed to just supply agreements in order to protect reputation/perception of autonomous driving," Barron's reports.

Additionally, Mobileye reported better-than-expected second quarter earnings before today's opening bell. 

The company posted earnings of 17 cents per share, beating analyst estimates of 15 cents per share. Revenue rose 58% year-over-year to $83.5 million, exceeding analyst projections of $77.31 million.

"In addition to winning new ADAS programs and new Tier-1 partnerships, we have begun an expansion of our value proposition by creating partnerships with automakers and others in order to bring fully autonomous driving to volume production with the next five years," said Mobileye CEO Ziv Aviram in a statement.

Mobileye also increased its year-end guidance to revenue of $344 million to $350 million and earnings in a range of 70 cents to 71 cents, Barron's reports.

Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:

We rate MOBILEYE NV as a Hold with a ratings score of C-. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and premium valuation.

You can view the full analysis from the report here: MBLY

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