Semiconductor maker Valens (NYSE:VLN) recently went public via special purpose acquisition company (SPAC). The maker of audio-video and automotive connectivity solutions did a reverse merger with PTK Acquisitions to go public on the NYSE in a business combination.
After the initial drop in shares to a low of $6.17, the stock has managed to climb back above $9.00 as investors become aware of this under-the-radar chip play leading the future of automotive connectivity. Part of its dominance is its forward-thinking that has enabled it’s first-to-market standing integrating the new leading automobile connectivity standard MIPI A-PHY in its VA70XX family of chips, which provide for UTP speeds up to 4Gbs and up to 32Gbps of video streaming from multiple remote sensors.
Despite the global chip shortage, the Company is helping to usher in the future of autonomous cars. Prudent investors seeking some exposure in the future of automotive technology can watch for opportunistic pullbacks in shares of Valens Semiconductor.
Valens Semiconductor
The Israeli-based chip maker specializing in high-speed connectivity solutions for the audio-video and automotive markets is already producing its chipsets to tier-1 automakers including Dimler, Continental, Harman, Bosch, and Molex. The automotive chips enable video and data, connectivity and multi streaming capabilities as well as telematics in vehicles.
Its chip sets also deliver real-time, no latency information from several cameras to provide a safer driving experience with driver assistance systems. It’s multi-gig connectivity solutions are already on the road with leading vehicle makers worldwide. Its chipsets are helping usher in the age of autonomous driving. It’s HDBaseT technology is the leading standard in the professional audio-video market having been installed in tens of millions of HDBaseT-enabled products. The Company expects widespread adoption of its MIPI A-PHY, a new global automotive video connectivity standard, by 2025 thanks to its strong pipeline of over 10 automotive partners.
Growth Expectations
The Company seeks to exceed a projected 48% annual growth rate. It targets the growing automotive high speed connectivity chip market which is estimated to grow at a 36.6% average annual rate from $1.6 billion in 2021 to $7.6 billion by 2026. The Company expects 2021 revenues of $67 million to grow to $480 million in 2026. Valens has managed to accomplish a 34% annual growth from 2010 to 2020 as top line rose from $3 million to $57 million during that time span. The Company also expects to achieve positive EBITDA by 2024.
Opportunistic Pullback Levels
Using the rifle charts on the weekly and daily time frames provides a precision view of the price action playing field for VLN shares. The weekly rifle chart is breaking down with a falling 5-period moving average (MA) at $13.27 about the cross the 15-period MA down at the $13.48 Fibonacci (fib) level.
The weekly market structure high (MSH) sell triggers on a breakdown under $11.58. The weekly stochastic has a mini inverse pup with lower Bollinger® Bands (BBs) at $10.24. The daily rifle chart is in a downtrend with a falling 5-period MA at $12.42 as the stochastic falls under the 20-band. The daily market structure high (MSH) sell triggered on a breakdown under $14.48 as it also collapsed through the daily market structure low (MSL) buy trigger at $13.48.
Prudent investors can monitor for opportunistic pullback levels at the $11.79 fib, $11.37, $11.79 fib, $10.60 fib, $9.88 fib, and the $9.40 fib. The upside trajectories range from the $13.48 fib up towards the $17.91 fib level.
