Assessing Aeva Technologies (AEVA) Valuation After Landmark Level 3 LiDAR Supply Deal with European Automaker

Aeva Technologies (AEVA) just landed a major win, being chosen as the exclusive LiDAR supplier for a top European automaker's global Level 3 vehicle platform. This development is sparking fresh attention on the stock and its long term revenue potential.

See our latest analysis for Aeva Technologies.

The market has been quick to respond, with a 12.78% 7 day share price return and year to date share price gains above 200 percent signaling that sentiment and growth expectations are clearly building despite earlier multi year total shareholder return weakness.

If this LiDAR deal has you rethinking the sector, it might be a good moment to scout other tech names and explore high growth tech and AI stocks for fresh ideas.

Yet with Aeva still loss making but trading at a steep discount to analyst targets after a huge year to date rally, investors now face a key question: is this a fresh entry point, or is future growth already priced in?

Price to Book of 27.9x: Is it justified?

Aeva's latest close at $15.44 comes with a rich valuation, as the stock trades at a steep premium to peers on a price to book basis.

The price to book ratio compares the market value of the company to its net assets on the balance sheet and is often used for hardware heavy and capital intensive tech plays like LiDAR and electronics because tangible assets and R and D investments matter for long term returns.

At 27.9x price to book, versus a peer average of 5.8x, the market is clearly paying up for Aeva's growth story and strategic auto wins rather than current fundamentals. This stance looks even more stretched when you note that analysts do not yet expect profitability within three years and there is not enough data to even calculate a fair value using the SWS DCF model.

Compared with the broader US Electronic industry average of 2.4x price to book, Aeva's 27.9x multiple stands out as aggressively higher. This implies investors are assuming this company will eventually justify a valuation more than ten times the sector norm despite today's negative returns on equity and ongoing losses.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price to Book of 27.9x (OVERVALUED)

However, risks remain, including execution challenges on the new auto platform and the possibility that high expectations unwind if revenue ramp or margins disappoint.

Find out about the key risks to this Aeva Technologies narrative.

Build Your Own Aeva Technologies Narrative

If you see the story differently or want to test your own assumptions against the numbers, you can build a custom view in just a few minutes, starting with Do it your way.

A great starting point for your Aeva Technologies 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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