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Telenav Reassures Investors & Affirms View as Shares Plummet

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In order to soothe investor nerves, Telenav, Inc. has reiterated its earlier guidance for fiscal 2020 and offered a fresh business update. The move was triggered by a 44.7% fall in share prices to $5.80 on Sep 5, 2019, on the news that its long-term business partner General Motors Company (GM - Free Report) has announced a deal with Alphabet Inc. (GOOGL - Free Report) for location-based services.

Telenav is a leading provider of connected car and location-based services. Reaffirming its earlier guidance, the company observed that it has solid business relationship with General Motors with contract obligations to offer navigational solutions for its models till 2025. Notably, Telenav’s navigational solutions form an integral part of a General Motors model that was launched in 2017. The company has been gaining in relative importance within the General Motors stable, garnering a steady market share and minting money for the automobile major.

Moving forward, Telenav reposed confidence on its differentiated product portfolio to help deter competition. These include VIVID (Versatile In-Vehicle Infotainment Design), a comprehensive embedded and cloud-connected, in-vehicle, personalized infotainment system; Advanced driver-assistance systems electronic systems; and in-car commerce and advertising platform. Although General Motors announced plans to use embedded Google technology to power navigation, voice activated controls and other vehicle infotainment functions starting in 2021 in some of its models, Telenav remains confident about its own business proposition.

The company further revealed that it is working with Microsoft Corporation (MSFT - Free Report) to integrate its connected-car solutions suite with the Microsoft Connected Vehicle Platform. Combining the prowess of cloud and edge services of Microsoft Azure, the Microsoft Connected Vehicle Platform empowers automotive firms to accelerate the development of connected vehicle solutions. The company expects to leverage these technological capabilities to offer unique in-car navigational services to enhance driving and mobility experiences.

Despite the sudden plunge in share price, the stock has outperformed the industry year to date with an average return of 42.6% compared with a rise of 13.5% for the latter.



Telenav currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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