Japanese multinational conglomerate Sony Group Corp. (SONY) is looking to enter the electric vehicle (EV) market with the lunch of a new company, Sony Mobility Inc., in spring, Reuters said in a report, citing the company’s Chairman and President Kenichiro Yoshida.
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“With our imaging and sensing, cloud, 5G and entertainment technologies combined with our contents mastery, we believe Sony is well-positioned as a creative entertainment company to redefine mobility,” he said.
Meanwhile, Yoshida unveiled VISION-S 02, a prototype SUV, at CES 2022 technology trade fair. The vehicle uses the same EV platform as the VISION-S 01 coupe that Sony has been testing on public roads in Europe since December 2020.
Sony Mobility will face competition from other EV stocks like Tesla (TSLA) and Nio (NIO), which are already present in the market.
Wall Street’s Take
Following the announcement at the CES, Morgan Stanley (MS) analyst Masahiro Ono reiterated a Buy rating on the stock but did not provide a price target.
In a note to investors, the analyst said, “We think Mr. Yoshida’s message indicates that Sony looks to drive the evolution of the mobility market through (1) sensing technology based primarily on CIS, (2) connectivity technologies that use 5G and the cloud, and (3) content that turns the vehicle interior into an entertainment space.”
“We look for a contribution to earnings over the medium term via increased opportunities to deliver entertainment content and an expansion of the CIS market, with the mobility market as the platform for this. He also revealed plans to launch the PS VR2, and we think this will raise expectations of a more sustained earnings expansion for Sony that initially draws on earnings contributions from the PS5 and then from inroads into the mobility market,” Ono added.
Overall, the stock has a Strong Buy consensus rating based on 3 Buys. The average SONY price target of $150 implies 16.7% upside potential. Shares have gained 29.4% over the past six months.
Website Traffic
TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into Sony’s performance.
According to the tool, compared to the previous year, Sony’s website traffic registered a 38.3% decline in global visits in November. Moreover, the website traffic has decreased 16.5% year-to-date against the same period last year.
Download the TipRanks mobile app now.
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