A Mercedes-Benz van is retrofitted with different types of flap systems, including Luminar’s Iris, to showcase the difference in technology.
Michael Wayland / CNBC
cap manufacturer light technologyaffected by Wall Street’s recent downgrade, is responding in an unusual way: taking its case directly to shareholders.
In a letter seen by CNBC on Friday morning, Luminar CFO Tom Fennimore — himself a former Goldman Sachs executive — countered the arguments made in a bearish note by the company. Goldman analyst Mark Delaney earlier this week.
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Delaney on Tuesday afternoon cut Goldman’s rating on Luminar for sale, from holding, argues that its stock is overvalued relative to key competitors and that Luminar’s own pricing assumptions are unrealistically high.
Shares of Luminar have fallen about 16% since Delaney’s note was published.
“We continue to consider Luminar one of the few leaders in the very competitive cap industry,” Delaney writes. “However, we see the company’s profit outlook decline with the company targeting revenue per vehicle of ~$1k which we believe implies ASP [average selling prices] about 50-100% higher than the main competitors.”
Simply put, while Delaney admits that Luminar is one of the few lidar makers to win contracts with major automakers, he thinks Luminar won’t be able to get the price they’re offering. expect to receive from those automakers. And based on his 2025 revenue assumptions, he sees Luminar trading at a valuation four times that of its competitors. renew And I’m wrongboth have won business from automakers.
Fennimore argues that Delaney missed two main points.
“First, our technology is better, and people often pay high fees for it, but for us, this is not a theoretical exercise: This is the price we actually charge, Fennimore told CNBC in an interview Friday morning.
Fennimore’s letter indicates that Luminar has contracted to provide hardware and software for More than 20 new vehicles coming soon from major automakers including Volvo, Polestar, Mercedes-Benz and Chinese auto giant SAIC Motor. Those contracts will lock in prices for the life of those upcoming models, he said.
“‘Premium Valuation’ is not a theoretical concept we are anticipating, but rather an achievement we have achieved in our major client contracts,” Fennimore wrote in the shareholder letter. winter.
And the second point that Fennimore thinks Goldman missed: The timeframe Delaney chose to compare Luminar’s valuation with its rivals.
“We believe that using 2025 sales as a benchmark against industry peers undervalues Luminar significantly, as many of the more than 20 models we have purchased,” he wrote. awarded is not expected to go into production until after 2025.”
In other words, some of the major contracts Luminar has signed won’t generate significant revenue until those vehicles launch in the second half of the decade, Fennimore said.
Luminar’s decision to dismiss shareholders directly is unusual, but Fennimore believes it is well-founded – and he hinted that Luminar may choose to send more letters like this in the future.
“Whenever anyone raises reasonable and thoughtful concerns about us, we like to respond with valid and thoughtful facts,” Fennimore told CNBC. “Because I think capital markets are based on having a good and realistic debate.”
