Aurora Innovations NASDAQ: AUR share price rose more than 50% after news of partnership with NVIDIA NASDAQ: NVDA. While there are hurdles to overcome, the share price could easily rise another 100% or more this year as the stock is deeply undervalued. The deal with NVIDIA is part of NVIDIA’s expansion into a broader range of end markets focused on its artificial intelligence technology. NVIDIA is looking to disrupt the self-driving industry, and Aurora is an important piece of that puzzle. NVIDIA provides the hardware and software to run the Aurora driver platform, and Continental OTCMKTS: CTTAF will place the components in sales packaging. The target market is large trucks, which will undoubtedly include other types of vehicles over time.
Aurora Innovations Today
Aurora Innovations
As of 01/08/2025 16:00 Eastern
- 52 week range
- US$2.10
▼
$9.83
- Target price
- $6.30
Unlike other technological advances, this one is scheduled to go into production this year. The initial market launch is scheduled to take place in May, with mass production to begin in 2027. The purpose of the transaction is large-scale production and deployment of products, capturing a large part of the global AV equipment market. The takeaway for Aurora investors is that this transaction validates the business while rapidly accelerating revenue growth and profitability prospects. In fact, ten analysts tracked by MarketBeat are forecasting four-digit hypergrowth in 2025, triple-digit growth in the next four to five years, and strong, double-digit growth for several years after that. In terms of valuation, the company’s P/E ratio in this scenario would be approximately 12x in 2030, which is significant for a high-growth technology company.
Insider, institutional and analyst trends are bullish on Aurora stock
Analyst trends favor higher prices for Aurora Innovation shares. Trends in 2024 and the first weeks of 2025 include increased coverage and price targets, with the consensus rating pegged at Hold and the consensus rating up more than 40% over 12 months and nearly 25% since December 2024 until January 2025. price movement in January. However, the most recent targets, including those set following NVIDIA’s announcement, have the stock at $10, which would meet the critical resistance target – the price at which the stock was trading when the SPAC merger closed in 2021 year.
Insider and institutional ownership in this company is strong and driving the share price higher. Insiders have been selling over the past year, with investor Reed Hoffman accounting for almost 100% of the sales. Hoffman is known for his role in creating LinkedIn and being an early investor. Despite this, insiders own about 15% of the shares, including a significant portion owned by Hoffman. On the other hand, institutions have been buying these shares quarterly for six consecutive quarters and now own about 45% of the shares. Institutional purchases are broad in scope and include leading firms such as JPMorgan Chase, Franklin Resources and State Street, as well as public and private equity firms and boutique money managers.
Aurora has the capital to achieve profitability
Aurora has reduced its share price by 15% in F2024 and there is a risk of additional dilution, but this has been mitigated for now. The company raised approximately $0.5 billion, bringing cash, cash equivalents and long-term investments to more than $1.35 billion. This leaves the company with a net cash position relative to total liabilities, with enough cash and investments to cover nearly 10 quarters of operations at the third quarter’s burn rate; Until then, the company will be profitable. Liabilities are approximately 0.18x cash and investments and 0.1x assets.
Technical Forecast: Aurora Stock Market Is Boiling
The Aurora stock market has been buzzing for months now, with volumes rising, driving up prices. The share price shows a clear bottom at $1.50, surpassing the end-2024 trigger point. The trigger point is the baseline/neckline for the reversal pattern and has been confirmed as support. Rising prices in 2025 confirm support at this level and indicate rising prices over time. With this, the market is likely to reach the $10 level to test the critical resistance target again soon. Assuming the market can rise above this level, a move upward into the mid to high teens is likely. At this price, the stock will trade at a price that better aligns with its growth prospects.
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