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Buy These 3 Stocks for Self-Driving Car Exposure

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Autonomous vehicles were all the rage last year, and this trend is set to continue in 2018 as the possibility of mass-produced self-driving cars inches closer to becoming a reality.

Even though roads full of self-driving cars likely won’t be seen for some time, companies that are serious about thriving when drivers are no longer needed must spend money and focus on that future today.

Technology giant Alphabet (GOOGL - Free Report) and its autonomous car firm Waymo are helping lead this charge, along with ride sharing power Uber. Automotive companies including General Motors (GM - Free Report) , Hyundai and countless other carmakers are also heavily invested in self-driving vehicle technology.

With this said, let’s take a look at three companies playing prominent roles in the autonomous vehicle revolution that are also looking like great buys right now:

1.      Ford (F - Free Report)

This U.S. automotive giant presented its vision of the future at CES on Tuesday. Ford’s “City of Tomorrow” plan includes a vision for connected cities, where vehicles, pedestrians, and traffic lights remain in constant contact in order to create a safer travel experience.

Ford also announced partnerships with Qualcomm (QCOM - Free Report) , Argo AI, Domino’s Pizza (DPZ - Free Report) , Lyft, and Postmates to help improve its own self-driving business. The company already has more than 700,000 connected vehicles on the road and plans to sell nothing but connected vehicles in the U.S. by next year (also read: Buy Ford (F - Free Report) After 'City of Tomorrow' Unveil At CES).

Currently, Ford is a Zacks Rank #2 (Buy) and sports an overall “A” VGM score. Ford’s 0.34 P/S and 1.57 P/B ratio mark substantial discounts compared to the “Automotive – Domestic” industry average. What’s more, the historic automaker, with its sights set on the future, is currently trading at just 8.53x earnings.

2.       Nvidia (NVDA - Free Report)

Nvidia just recently announced its new augmented reality, driverless car technology called “Nvidia Dive AR.” Nvidia has also announced partnerships with Volkswagen (VLKAY - Free Report) and Uber that will see the chipmaker bring its AI tech to the auto companies’ respective self-driving car projects. Furthermore, this Wall Street A-Lister’s DRIVE PX AI car computer is designed to help a wide range of companies produce automated and autonomous vehicles.

Nvidia is currently a Zacks Rank #1 (Strong Buy) and sports an “A” grade for Growth in our Style Scores system. The company’s stock price hit a new 52-week high on Monday after its CES presentation. Looking ahead, Nvidia is expected to see its sales jump 22.35% next quarter, while its earnings are projected to pop 16.16%, based on our current Zacks Consensus Estimates (also read: Why Nvidia Has Already Won CES 2018).

3.       Toyota Motor Corporation (TM - Free Report)

Toyota just recently introduced its new e-Palette autonomous vehicle concept at CES. The vehicle is an all-electric, driverless shuttle for commercial use that is set to debut at the 2020 Olympics in Tokyo. Amazon (AMZN - Free Report) and Pizza Hut (YUM - Free Report) have already partnered with Toyota’s e-Palette Alliance. This Japanese automotive power also unveiled a new Lexus autonomous test vehicle.

Toyota is currently a Zacks Rank #2 (Buy) and earned a “B” VGM grade, which was supported by its “A” grade for Value in our Style Scores system. The company is currently trading at just 11.17x earnings, which marks a discount compared to the S&P 500’s average.

What’s more, Toyota’s P/S ratio of 0.77 helps demonstrate its strong value, while its 1.17 P/B ratio marks a discount against the “Automotive – Foreign” industry average. Shares of Toyota jumped to close at a new 52-week high on Wednesday as it builds momentum from its recent self-driving announcements.

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