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Luminar stock declines on Goldman Sachs downgrade

Yahoo Finance

Yahoo Finance Live anchors Julie Hyman and Brad Smith discuss Goldman Sachs’ Sell rating on Luminar stock.

Video transcript

JULIE HYMAN: Not so positive, however, on our next mover. And that's Luminar. Shares are sliding after Goldman Sachs downgraded the tech company to a sell, saying it's fully valued and it's going to face greater margin pressure. Luminar shares down some 7% here this morning.

The analyst over there, Mark Delaney, saying that they continue to see Luminar as "one of a handful of leaders in the very competitive LiDAR industry." That's a quote from the note here. However, it really has to do with the company's margin outlook, revenue per vehicle. And also, they're looking at what has happened with the stock and that the stock is now more fully valued. So all of that affecting the shares here this morning. I hadn't had a chance yet to check to see if there are any other sells on Luminar, but it's interesting to get this kind of a call on the company.

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BRAD SMITH: Yeah, within the notes--

JULIE HYMAN: I think it's the only one. It's the only one. Only sell on the company.

BRAD SMITH: Only sell. OK, singular lone wolf out there. Or lone bear. But Luminar attributing this higher average selling price in part to software, the note had also said. And they also believe it's got some opportunities in that regard. The market for the software is highly competitive. And they also believe underlying hardware gross margins, tailwinds from software, it could be lower than the company targets there. And so that is within the note. But they ultimately think that the current valuation is expensive right now.

JULIE HYMAN: Yeah, the stock is up, even with today's drop, 56% this year.

BRAD SMITH: Interesting.

JULIE HYMAN: I mean, it's down over the last year, I believe, like so many of these tech stocks.

BRAD SMITH: 51%, I think.

JULIE HYMAN: Yeah 51% or so. And then has had this rebound. So we'll see.

BRAD SMITH: [LAUGHS] Lots of tracking lasers in the world of lasers, everyone.