3 Up-and-Coming Autonomous Driving Stocks to Put on Your Must-Buy List

Josh Enomoto

Wed, Aug 30, 2023, 7:24 PM 4 min read

While individual motivations may vary, in my opinion, there’s only one core reason to consider autonomous driving stock picks: the total addressable market. That’s because once the sector gets going, it’s gargantuan. In fact, jump aboard the right self-driving stock opportunities and you can ride your portfolio to possibly life-changing gains.

According to Mordor Intelligence, the autonomous vehicle market size may reach $33.48 billion this year. Even better, experts in the field project that the sector could expand at a compound annual growth rate (CAGR) of 22.75% from 2023 to 2028. By the culmination of the forecast period, the future of driving stocks may have a valuation print worth $93.31 billion.

And that might be on the conservative side. For example, McKinsey & Company reports that by 2035, autonomous driving may create $300 billion to $400 billion in revenue. By positioning yourself in must-buy self-driving stocks, you may accrue mind-blowing returns.

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Naturally, you do want to take precautions as innovative sectors almost always carry high risks. Still, if you’re willing to absorb them, these are the top autonomous vehicle stocks to consider.

Autonomous Driving Stock Picks: Aptiv (APTV)

An Aptiv (APTV) office building in Poland.

Source: shutterstock.com

A global technology firm focused on automotive innovation, Aptiv (NYSE:APTV) may not be the most obvious choice for autonomous driving stock picks. However, it fits the bill quite nicely if you’re looking for an up-and-comer with strong upside potential. Established as an independent entity in December 2017, its origins trace back to Delphi Automotive and General Motors (NYSE:GM). So, it’s not a pure startup per say because of the distinct rebranding history.

Still, APTV belongs on your radar of less-appreciated but still potent must-buy self-driving stocks. Regarding autonomous mobility, Aptiv creates and refines the underlying software, sensors and computing platforms that fuel this innovation. Even better, the company has partnered with Hyundai Motor Group to bring autonomy to the next level.

Financially, Aptiv is a bit of a mixed bag. However, what’s intriguing is its trailing-year operating margin of 9.16%, beating out 75.45% of its peers. Also, analysts dig APTV, pegging it a moderate buy. Further, their price target lands at $130.10, implying over 29% upside potential.

Aurora Innovation (AUR)

A young woman reads a book while behind the wheel of a self-driving car.

Source: Shutterstock

Founded in 2017, Aurora Innovation (NASDAQ:AUR) is a compelling idea among autonomous driving stock picks. Encouragingly, Aurora commands an enviable pedigree. Co-founded by Chris Urmson, the tech expert previously led Google’s – under the Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) umbrella – self-driving car project, which eventually became Waymo. Since the start of this year, AUR gained an impressive 181%. Still, there could be more gains to be had.

Aurora’s main product is Aurora Driver, a self-driving system with a common core of hardware and software designed to adapt to a wide range of vehicle types, per its website. This versatility encompasses anything from a four-door sedan up to a Class 8 semitruck. Notably, the underlying system is durable, working against all kinds of inclement or unusual weather conditions. As well, its compact.

Unsurprisingly, investors have targeted AUR as the future of driving stocks. Per Wall Street analysts, Aurora is a consensus moderate buy. Further, the experts’ price target clocks in at $5, implying over 53% upside potential.

Aeva Technologies (AEVA)

7 Autonomous Vehicle Stocks to Drive You to the Future

Source: Shutterstock

For those wanting to maximize the return potential of their top autonomous vehicle stocks, Aeva Technologies (NYSE:AEVA) belongs on your radar. Also founded in 2017, Aeva came to life thanks to Soroush Salehian and Mina Rezk, former Apple (NASDAQ:AAPL) engineers. Primarily, the company specializes in lidar (light detection and ranging) innovation.

What distinguishes the tech specialist from other self-driving stock opportunities is its 4D lidar technology, per its website. Management calls its system “4D” because it captures three spatial dimensions – length, width and height – along with a velocity dimension simultaneously. In other words, Aeva’s tech can detect roadway objects’ location and movement, enabling superior (and safer) decision-making.

To be fair, AEVA trades at only a few cents above a buck. Also, since the Jan. opener, it lost almost 20% of equity value. Nevertheless, AEVA presents a compelling idea for autonomous driving stocks due to analyst support, which pegs it as a moderate buy. Further, the experts forecast AEVA to hit $2.41, implying 134% upside potential.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.