Lidar stocks have been a hot topic lately. They are increasing in popularity because of lidar’s numerous applications in various industries, with the most prominent being aerial mapping and self-driving vehicles.
For those not so acquainted with the term, it is worth explaining that lidar is an abbreviation of “laser imaging, detection, and ranging.”
LiDAR is a laser-based technology that utilizes lasers to measure an object’s distance from the earth’s surface. We use LiDAR in agriculture, forestry, watershed and river surveys, and geologic mapping.
- Oceanography (for determining the ocean’s depth and calculating the fluorescence of phytoplankton and biomass in the ocean surface).
- 3D modeling of the terrain (for various construction projects).
- Agriculture (investigation of crop yield, scouting of crops, and seed distributions).
- Archeology (mapping).
The LiDAR technology has been available since the 1960s when laser scanners were mounted to airplanes to emit light beams towards the earth’s surface and provide distance measurements. However, when GPS tracking came to life in the 1980s, it gained substantial popularity as a method of assessing geospatial measurements. As a result, the information provided by LiDAR technology turned into a valuable instrument for giving precise geospatial estimations.
Being that investing in lidar stocks is a popular topic, we will jump into more insights concerning both lidar stocks and notable lidar companies.
What Is Lidar? What Is Lidar Used For?
LiDAR is a high in-demand technology these days, and with a good reason. LiDAR’s primary use is determining the distance between an object and a receiver.
Lidar does it by scanning an object using a laser and estimating the time required for the reflected light to get back to the receiver. Since the speed of light is approximately 186,000 miles per second, the assessment of distance completed with LiDAR is highly efficient. The time that the reflection of the laser takes to return to the LiDAR sensor determines the measured object’s distance from the laser. The formula we use for this calculation is:
The distance of the object=(Speed of Light x Time of Flight)/ 2
The results of this simple system (but quite advanced technology) are astonishing! Since this mechanism can measure every dot of space, the device can develop an accurate 3-D model of any terrain, surface area, or object.
The first lidar-like system originated in 1961, after the creation of the laser.
Its primary purpose was satellite following, yet later on, it got its earthbound application.
LiDAR utilizes ultraviolet, visible, or near-infrared light to picture objects, while a laser beam is there to map physical features with very high resolutions.
Lidar sensors function the following way – lidar scanning units emit hundreds of thousands of pulses per second, and those light waves hit the object and return to the lidar sensor.
The sensor then measures the time required for each pulse to return to calculate distance.
The utility of this technology and the process it enables is vast.
We also use lidar to make computerized 3-D representations of areas on the earth’s surface and sea base.
What makes it so valuable is the fact that it has both terrestrial and airborne applications.
Types of lidar technology
Terrestrial LiDAR technology is mounted on driving vehicles or tripods that collect data from the earth’s surface. Projects concerning infrastructure, highway construction, and urban construction usually use accurate data collection. The machines containing LiDAR can efficiently measure distances, object sizes, shapes, and terrain properties which helps contractors immensely.
There are two types of terrestrial LiDAR systems — Mobile LiDAR and Static LiDAR.
Helicopters and drones that collect data have airborne LiDAR systems. From the aerial machines, airborne LiDAR transmits light towards the terrain’s surface, which reverts to the receiver of the LiDAR system almost instantly, providing the measurements of the distance between the sensor and the surface.
Airborne LiDAR also has two sub-types — Topological LiDAR and Bathymetric LiDAR. Topographic lidar uses a laser with infrared for mapping and measuring. In contrast, bathymetric lidar uses a green light that penetrates water for mapping and measuring the seafloor and the elevations of the riverbed.
Both scientists and mapping professionals have LiDAR systems to thank for examining and calculating the terrain properties of natural and artificial environments. This way, many maps of the shoreline and terrain elevation models are created and used for different purposes. Some of these applications include information systems representing geographic info or emergency response operations using the LiDAR data.
Any lidar instrument consists of a laser, a scanner, and a specialized GPS receiver.
What is lidar used for?
The usage of LiDAR is so far-reaching and widespread, as its applications are present in surveying, geodesy, archaeology, geography, geology, etc.
However, its primary utilization is the automotive industry, being that these instruments control and navigate some autonomous cars. Autonomous vehicles use LiDAR for obstacle identification and avoidance, navigate securely through environments, and ensure vehicle and passenger safety.
This purpose is the backbone of the LiDAR system’s appeal on the market. Autonomous cars and other human-crewed or uncrewed vehicles represent one of the biggest priorities in the technology industry nowadays, and the market seems to be constantly growing.
Firstly, UAV drones, either remote-controlled or AI-operated, equipped with LiDAR, are in production at a growing rate. We use these machines to scan an accident site, forestry, agriculture and landscaping, terrain modeling, archeology, and mine inspections.
Furthermore, experts constantly mention AI-operated machines in the context of efficient global delivery of goods bought through e-commerce. Could this technology also profit from LiDAR sensors since precise measurement of the surroundings and autonomous movement through space and around obstacles could contribute to a successful delivery? Maybe so.
Even if not, the impact LiDAR technology is creating in the fields it’s being used in is impressive. For example, the UAVs scanning accident sites can provide accurate forensic information and upload it within seconds for court evidence.
The impact of lidar
This instance also removes the factor of entire crews of specialists that take hours to get to the scene of the event and spend thousands of dollars to assess the data necessary to create a viable case. This technology saves millions of dollars of public funds, and its implementation is only going to grow.
Also, the measurements of vast forests that are a prerequisite to producing goods such as paper accelerate with UAVs that can scan vast areas of inaccessible terrain with impressive efficiency, fluency, and precision. With the addition of this technology, production is becoming faster and cheaper.
In agriculture, huge farms profit immensely from LiDAR equipped drones that scan the farmland and provide crucial data used in irrigation systems implementation.
Drones also create precise and detailed terrain models containing even the smallest scanned objects, such as leaves, bushes, plants, and small obstacles.
The AI-operated small aircraft can also scan historical and archeological sites and provide data crucial for digging and exploring delicate historical objects. Moreover, the aircraft does it without damaging or marring the archeological material.
LiDAR’s scientific utility, however, does not end there. NASA has acknowledged LiDAR as a critical innovation for empowering autonomous precision safe landing of future robotic and lunar-landing vehicles. Therefore, LiDAR becomes a vital component of the technology dedicated to space exploration and further scientific discovery.
The main advantage of LiDAR technology is that precise measurement of terrain and objects through computer-operated machines has countless forms of application.
Its’ endless and ever-growing utility is what makes LiDAR technology relevant on the market, and investing in lidar stocks popular.
Investing In Lidar Stocks – The Increased Interest of Wall Street
Considering that lidar is the fundamental innovation behind autonomous vehicles, lidar stocks have recently opened up to the world and hit the market through consolidations with special purpose acquisition companies or SPACs.
A special purpose acquisition company or SPAC is an organization created for growing funds by creating an initial public offering or an IPO. This business mechanism allows interested parties to invest their money into a fund.
After the IPO, the SPAC and the investors’ fund goes on to acquire other businesses identified after the initial public offering.
Usually, the founders of these companies have already decided on their acquisition target company. The founders then provide a starting sum for the company and begin the process of sourcing funds from the investors, staking their positive reputation and vast experience. Once the founders have collected the funds, they will start acquiring the targeted company, in which they will hold a significant stake (usually 20% of the stock), which is the source of their benefit. Thus, investors too will benefit proportionate to their initial capital investment.
Is it wise to invest in lidar stocks?
Lidar is essential for self-driving cars as it is the only way for the AI to create an image of the street, scan traffic signs, identify pedestrians, bicycles, and other objects on the road. This means that LiDAR companies have great potential to reap the benefits.
Auto technology stocks got Wall Street’s attention this year, and numerous young investors see auto technology as a main long-term investment opportunity.
A dozen companies have been committed to producing self-driven cars or AI programmed to increase driving efficiency, safety, and comfort.
Some of them are dedicated to analyzing traffic, collecting data from the analysis, and creating risk reduction strategies. This is one of the main components of the self-driving goal that the technology industry is trying to achieve.
Other companies are developing stations for wireless charging for electric cars. These stations work like magnets that charge electric vehicles that are parked in a designated area. This step is one of the key ones in making electric and self-driven cars more durable over greater distances.
Technology developers are keen to create better and faster apps for mobile and smart devices that can communicate with the autonomous car’s AI, increasing users’ access to different car features, quality, and safety of their traveling experience.
Self-driving AI technology is also continuously paired with VR technology, making users able to use visualization tools and access physical navigation of their vehicle.
Lidar technology development
Furthermore, self-driving vehicle technology goes hand in hand with the ride-sharing concept, offering future users the option to call for, organize, and share an autonomous Uber that safely, efficiently, and smoothly takes them to the desired destination. No drunk driving, fatigue, or risk. Less emission and pollution as well as responsible use of energy.
Furthermore, considering LiDAR depending technology can be combined with other modern industry novelties, we consider it the next step towards more safety, responsibility, and better quality of life.
However, the most significant buzz on the market happened when Apple announced that they were planning to invest in an Apple-made self-driving car as soon as 2024. The news created a bang on the stock market, raising the stocks of two lidar sensors major producers by an astonishing 20 to 30%.
Apple is reportedly planning to outsource some of the parts for the self-driving system, including LiDAR sensors. However, no specific LiDAR suppliers were listed, and other reports stated that Apple could choose to design its LiDAR systems. Apple smart devices already contain a LiDAR sensor as a part of their camera, so LiDAR lasers are already an integral part of Apple technology.
These recent developments provoked the investors’ curiosity concerning LiDAR stocks.
However, it is impossible to predict the eventual fate of this innovation with absolute clarity and understanding of the dynamics of its development.
Some investors who own LIDAR stocks believe that by 2025 we will experience the sales of millions of lidar sensors as the age of self-driving cars is coming closer and closer.
Lidar and Ecology
Why is lidar a big deal for both the environment and the auto industry?
If we all use autonomous vehicles, specialists believe that it will have a massive impact on congestion and, consequently, the encouragement of more travel without polluting the environment.
Autonomous vehicles will lead to more effective driving practices, improved accident prevention, and decreased fuel usage, hence making the 40% reduction in road energy.
The environmental contribution that autonomous vehicles could make by more efficient use of fuel depends on LiDAR technology. Also, we could increase passengers’ safety with AI-operated driving and accident-preventing maneuvers.
However, the environmental impact of LiDAR does not end there.
Ecologists gravitate towards LiDAR technology to create detailed scans of the ecosystems, disregarding the traditional two-dimensional scanning technology.
The three-dimensional representation of vegetation patterns significantly determines the distribution of different organisms in the ecosystem and its wildlife.
The limitations of traditional technology regarding mapping the landscape’s vegetation are considerable since this old technology can only create images set in the x and y coordinates, which prevents ecologists from getting insight into important habitat factors such as the forest canopy structure.
How lidar contributes to the environment?
That’s where LiDAR comes into play, with its vast potential for 3-D imaging landscape in multiple layers and giving researchers important data for projects of animal species preservation, tracking of animal migrations, conserving the appropriate structure of forests, and other different habitats, etc. In addition, the appearance of LiDAR helped empower the exact measurement of 3-D ecosystem structure, thus influencing a better comprehension of animal dynamics.
The LiDAR system also significantly contributed to Brazil’s government’s effort to improve their production of bio-ethanol. Namely, scientists consider bio-ethanol a viable fossil-fuel replacement and additive intended to decrease carbon emission and environmental pollution. They create this additive by conversion from sugar, and Brazil uses its vast potential as the biggest sugar cane producer globally. The country possesses 350 sugar mills and produces around 500 million tons.
However, during sugar cane harvesting, the fields are burnt, which pollutes the air with smoke and particles. Therefore, the harvesters have introduced LiDAR systems that monitor the atmosphere and profile the aerosol to avoid this countereffect.
This way, LiDAR becomes a key component in yet another project that aims to decrease fossil fuels, carbon emission, and pollution.
Lidar Stocks – Recent Market Developments
Lidar technology empowers plans for self-driving cars, and some major companies such as Waymo, General Motors (GM), and BMW depend on it, except Tesla.
According to Tesla’s CEO Elon Musk, the future of self-driving is “vision only,” and lidar or radar are not necessary.
However, for self-driving vehicles to “see” as much as a human eye can see, they would need dozens of cameras mounted on them. That is costly and not a widely accepted solution.
Then again, two Lidar sensors can do what dozens of cameras would be able to do, and that is the main reason why lidar companies are unquestionably the future of self-driving.
Semi-autonomous cars are already a familiar sight in numerous urban cities, while China started testing fully autonomous vehicles.
Shortly, both semi-autonomous and fully autonomous vehicles will be standard on the streets all across the globe.
According to experts in investment, lidar is currently a popular investment opportunity. If you are considering investing in lidar stocks, it is important to form a strategy first.
How To Invest in Lidar Stocks?
Before settling on which stock to purchase, an investor should open an account with a broker. A stockbroker is a company with authorization to buy and sell stocks on the investor’s behalf.
The stockbroker will provide the investor with a suitable platform, after which they’ll be able to conduct their purchases on the stock market.
It takes serious analysis for an investor to choose the appropriate lidar stock.
Acquiring information about the lidar company presents a crucial element for profitable investment and the biggest challenge for the investor. Moreover, looking at the right information can offer a clue for the investor regarding the progress of the bond prices.
Firstly, the diversity of the company’s business model producing LiDAR technology is one of the main factors to consider.
Companies that engage in different LiDAR related endeavors and operations communicate with different markets, produce and place products for various partners scattered around the globe, have a better chance of making a stable profit, and increasing stock price growth.
As with all stocks, diversity is vital.
Tips for investing in lidar stocks
An investor should also look for future projects, the company’s plans for developing more sophisticated and better-utilized technology that will secure their stable position on the market, and their ability to sustain the supply of modern technology that meets the industry’s demand.
For example, Luminar entering the Chinese market, establishing cooperation with SAIC, the most prominent automotive company in China with goals to incorporate its Sentinel system into the “R Brand” cars, is a good sign of their commitment to expanding their market potential.
Furthermore, Velodyne’s recent announcement for producing an advanced lidar device called H800 that they plan to sell for $500 presents an encouragement for potential investors. This incitement is because previous models that performed exceptionally will become cheaper, and their demand on the market will grow. At the same time, the new model promises a continuation of the company’s tendency to remain a relevant participant on the market.
Factors to consider when investing in lidar stocks
The factors, such as the diversity of the business model and the lidar company’s vision for the future present significant elements to look into when considering investing in lidar stocks.
One of the critical factors to consider when choosing the right lidar stock is the increase in the price of bonds over the last year. In addition, an investor would want to see a positive trend in how a company selling its’ lidar shares is doing its’ business.
Another factor that should encourage the potential investor is low debt and a positive cash flow. The cash flow should be positive even when stock prices are low.
In the case of companies where the cash flow is not favorable, investors should look into the earnings per share data (EPS). Instead of the general earnings number, this information shows the potential investor the gradual progress of the company. Likewise, if a company reduces its debt over time, that can also encourage the potential investor.
Top Lidar Companies On The Market
The development and appreciation for the lidar market are so incredible that numerous organizations compete to supply automobile companies with vital sensors to improve their driverless vehicles.
We will offer you references to five stocks.
Velodyne Lidar (VLDR)
Velodyne Lidar (VLDR) is leading the LIDAR market.
It was established in 1983 by David Hall as an audio company specializing in subwoofer technology. Still, Velodyne Lidar is currently involved in other services such as delivering sensors to mobility industry clients for testing and use in autonomous vehicles, advanced driver assistance systems, mapping, robotics, infrastructure, and smart city applications.
The company became public through a SPAC in September 2020.
The company shows significant diversity in its business model, developing partnerships with Ford, Baidu (NASDAQ: BIDU), and Hyundai Mobis.
Furthermore, its operations run in a broad area of technology development. Apart from creating LiDAR for self-driven cars, the company is developing sensors for AI robots. Its 3D LiDAR received the 2020 Innovation Award in robotics. This technology can go into drones as well as vehicles. It is looking to become one of the most demanded LiDAR systems in the industry.
The company’s market capitalization is $3.4 billion.
Velodyne Lidar has a headquarter in San Jose, California, and since September 30th, 2020, it has been trading stocks and warrants on NASDAQ under the symbols VLDR and VLDRW.
The company has 500 employees and around 300 clients, including major auto and technology companies.
Company Website: https://velodynelidar.com/
Luminar Technologies (LAZR)
Luminar Technologies company came to life in 2012 in Orlando, Florida, USA.
This autonomous vehicle and lidar technology organization designs, manufactures and sells long-range lidar items for autonomous driving.
In recent months, the company has seen its stock decline by about 18% to about $24 per share. In addition, the company has been hit by a sell-off in growth and tech stocks, as it is still undeveloped enough concerning its production levels.
The company aims to transform its endeavor from a plain lidar vendor into a developer and a producer of lidar technology, with their Sentinel system designed in partnership with Zenseact.
This collaboration aims to combine the perception software of the AI developed by Luminar and their lidar tech called Iris with Zenseact’s driving software.
The partnership could benefit both companies since the result could be a brand new and flashy technology utilized in the new generation of self-driven cars.
Since December 3rd, Luminar Technologies (LAZR) has been trading lidar stocks on NASDAQ under the ticker symbol LAZR.
Nowadays, it has gained more than 107%.
The company signed enormous contracts with essential partners such as Intel Corp., the Volvo Group, and others, Luminar’s Iris lidar sensors will be installed in Volvo’s vehicles from 2022.
Thus, Luminar Technologies could gain an income of $837 million by 2025.
Company Website: https://www.luminartech.com/
ON Semiconductor (ON)
ON Semiconductor is a company with headquarters in Phoenix, Arizona, United States, that employs 36000 people and offers various smart sensing solutions for the auto industry.
The company was founded in 1999, and since then, it has been selling products including power and signal management, logic devices for automotive, LED lighting, and so on.
This organization boasts the SiPM dToF LIDAR platform, a comprehensive solution for affordable, single-point lidar.
It began exchanging stocks on NASDAQ and Russell 1000 Component under the symbol ON.
Company Website: https://www.onsemi.com/
Veoneer, Inc. (VNE)
Veoneer, Inc. originated in a partnership with Velodyne.
The company is owned by both American and Swedish owners that supply products related to automotive vehicle technology.
It is based in Stockholm, Sweden, and has 9200 employees.
Veoneer manufactures and commercializes LIDAR systems for automotive usage, utilizing Velodyne’s adaptable auto-grade lidar sensor and core 3D software technology.
Furthermore, Veoneer’s products include radars, cameras used at night, and systems that enable autonomous vehicles to move safely.
It began trading stocks on NYSE as VNE and Nasdaq Stockholm: under the symbol SDB.
Company Website: https://www.veoneer.com
Ouster (OUST) made its first financial exchange on March 12th.
This is an American company settled in San Francisco, California, in 2015, has 125 employees, and manufactures and sells lidar technology.
Some of its products are 3D lidar sensors that can be used in the autonomous vehicles industry and robots, drones, and surveillance systems.
It is traded on NYSE under the symbol OUST.
Company Website: https://ouster.com/
Investing in Lidar stocks – Conclusion?
We’re still a long way from self-driving cars that can detect and analyze the surroundings, assess the potential risks, create driving patterns, and protect the passengers while being charged through a magnet with zero toxic emissions.
However, we utilize LiDAR systems in industry, science, exploration, agriculture, production.
Investing in lidar stocks – a good idea?
The above-described “sci-fi scenario” perhaps isn’t as far-fetched as one might think. Why?
Because companies like Apple, Volvo, or Ford don’t invest billions of dollars, hire numerous teams of promising advanced tech developers and scientists, and develop additional time and money-consuming projects for the future if they don’t expect to see their investment returned.
Apart from that, the appeal of LiDAR technology is not only in its potential to introduce a new and flashy way of improving our quality of life. It’s in the technology’s potential to positively contribute to the everlasting struggle of the modern world to create a cleaner environment, preserve our ecosystems, learn about the changes that our planet is going through that can impact us significantly.
As always, one of the critical factors when choosing an option for one’s investment is the existence of a higher perspective, a contribution to a common goal, and the potential to create a better and cleaner future.
The LiDAR technology is a part of the industry’s positive transformation to a more responsible paradigm of the production of goods.
An opportunity to be a part of a lidar revolution could invoke curiosity from investors. However, a chance to make the future better for everyone should grab their attention for a longer time.
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This article was last updated on November 1st, 2021.