WeRide (NasdaqGM:WRD) Valuation After Landmark Level 4 Driverless Robotaxi Rollout With Uber in Abu Dhabi

WeRide (NasdaqGM:WRD) just flipped the switch on fully driverless Level 4 Robotaxi service with Uber in Abu Dhabi, the first city outside the U.S. to host driverless rides on Uber’s platform.

See our latest analysis for WeRide.

That backdrop helps explain why the 7 day share price return of 16.4 percent and latest move to 9.36 dollars comes after a tough year. The year to date share price return is still down 34.0 percent and 1 year total shareholder return is negative, suggesting momentum is only just starting to turn as execution and risk perceptions slowly improve.

If this autonomous push has caught your attention, it could be worth scanning other high growth tech and AI names using high growth tech and AI stocks to spot the next wave of potential movers.

With shares still well below analyst targets despite rapid revenue growth and narrowing losses, investors now face a key question: is WeRide still underappreciated by the market or already priced for its next leg of expansion?

Price to Sales of 44.3x: Is it justified?

Using the latest close at 9.36 dollars as a reference point, WeRide trades at a markedly rich valuation versus its own industry and peer set.

The preferred metric here is the price to sales ratio, which compares the company’s market value to its annual revenue and is often used for high growth, loss making businesses where earnings are not yet a reliable guide.

At 44.3 times sales, the market is effectively paying a premium that assumes very strong future monetisation of WeRide’s autonomous platforms, far beyond what current revenues and ongoing losses would normally justify for an auto components name.

That premium stands in sharp relief against both the wider US Auto Components sector, where the typical price to sales multiple is just 0.8 times, and the peer group average at 0.7 times. It also towers over an estimated fair price to sales ratio of 16.9 times that our models suggest the market could eventually gravitate toward if expectations cool.

Explore the SWS fair ratio for WeRide

Result: Price to Sales of 44.3x (OVERVALUED)

However, WeRide still faces heavy losses and regulatory uncertainty around large scale autonomous deployment. Any setback could quickly puncture sentiment and today's premium valuation.

Find out about the key risks to this WeRide narrative.

Build Your Own WeRide Narrative

If you see the numbers differently or want to dig into the data yourself, you can build a personalized thesis in minutes with Do it your way.

A great starting point for your WeRide research is our analysis highlighting 1 key reward and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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