Maxim Integrated Products, Inc. (MXIM - Free Report) has entered into a partnership with NVIDIA Corporation (NVDA - Free Report) to focus on safety and other important requirements needed for autonomous vehicles.
Per the agreement, Maxim's next-generation 6Gbps GMSL SerDes technology will now support the DRIVE Pegasus platform. Moreover, Maxim's ASIL rated voltage/power monitoring and SerDes technology will also be used by NVIDIA for its DRIVE Xavier Level 4 driving platform.
Maxim's SerDes technology supports the important requirements (high data rate, complex interconnect, data integrity and safety) for the future of automotive infotainment, ADAS, and autonomous driving. Also, Maxim supplies low IQ automotive-grade power management solutions for high-performance analog integrations.
Notably, shares of Maxim have returned 31.6% in the 12-month period, outperforming the industry’s gain of 27.7%.
What is Pegasus?
Pegasus is a system-on-chip (SoC) which is built on the NVIDIA Volta architecture-based GPUs. It helps in driving fully autonomous robotaxis, which can handle the concept of Level 5 self-driving vehicles, and uses NVIDIA’s DRIVE PX 2 platform, trained on deep neural networks.
Pegasus also integrates a new computer vision accelerator aimed for ASIL D certification — the industry's highest safety level. It also features multiple 10Gbit Ethernet connectors.
Lately, Maxim’s automotive business has been growing. The company has invested heavily in vehicle safety technology that could prove to be foundational for a driverless car future.
Infotainment, safety and driver assistance content, known as ADAS, are long-term drivers of the automotive business. Maxim’s smart meter SOCs are increasingly replacing discrete solutions, while its infotainment, video transmission, USB ports, LED lighting and other products are witnessing notable application in the automotive segment.
Recently, the company saw strong growth in automotive battery management systems for electric vehicles and hybrid cars across multiple customers, with particular strength in China. China is expected to create more opportunities, as Chinese infrastructure spending boosts demand for its factory automation products.
We believe the new deal will help it in gaining more share in the automotive market and expanding its top-line growth.
Maxim carries a Zacks Rank #4 (Sell). A few better-ranked stocks in the broader technology sector are ASML Holding N.V. (ASML - Free Report) and Lam Research Corporation (LRCX - Free Report) , each sporting a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings per share growth rate for ASML Holding and Lam Research is projected to be 22.6% and 14.9%, respectively.
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