Al Root

Mobileye stock was dropping Monday after catching a downgrade from Goldman Sachs. The proliferation of self-driving cars isn't benefiting the tech company as much as one analyst expected.

Monday, Goldman Sachs analyst Mark Delaney downgraded shares of Mobileye, a maker of sensors and software for driver assistance features and self-driving cars, to Hold from Buy. He left his price target unchanged, however, at $17 a share.

Competition is a problem. Alphabet's Waymo completes more than 250,000 paid self-driving taxi rides a week and Tesla is about to launch its robo-taxi service in Austin, Texas, this month. Delaney says Mobileye has strong technology, but the uptake by auto makers has been slower than expected.

"While we believe Mobileye can benefit from growth in autonomy too, we downgrade the stock to Neutral in a separate note to better reflect the degree of competition in the market," added the analyst.

Mobileye stock was down 2.8% in early trading at $16.42, while the S&P 500 and Dow Jones Industrial Average were up 0.1% and down 0.3%, respectively.

Goldman estimates the market for ride-hailing in the U.S. is about $58 billion today. That could be north of $330 billion by 2030, helped by self-driving cars that remove costs by removing the driver. Autonomous vehicles will only be serving a small sliver of the market by the end of the decade, however. Delaney is watching to see how the technology scales and spreads across the nation.

With the cut, 48% of analysts covering the stock rate shares Buy, according to FactSet. The average Buy-rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target for Mobileye stock is just north of $18 a share.

Coming into Monday trading, Mobileye stock was down about 15% year to date and down almost 50% over the past 12 months.

Write to Al Root at allen.root@dowjones.com

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June 09, 2025 10:20 ET (14:20 GMT)

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