Indie Semiconductor Inc

Indie Semiconductor, Inc. (NASDAQ: INDI) offers automotive semiconductors and software solutions for advanced driver assistance systems (ADAS), driver automation, in-cabin, user experience (including connected car) and electrification applications. The Company is focused on edge sensors across multiple modalities spanning light detection and ranging (LiDAR), radar, ultrasound, and computer vision. It is an approved vendor to Tier 1 automotive suppliers and its platforms can be found in marquee automotive manufacturers around the world.

Recent Business and Financial Updates

First Quarter Financial Performance and Strategic Outlook: Indie Semiconductor, Inc. recorded a 29% year-over-year increase in revenue, amounting to USD 52.4 million, with a non-GAAP gross margin of 50.3%. Despite this growth, the company faced a GAAP operating loss of USD 49.6 million, up from USD 37.0 million the previous year. The non-GAAP operating loss for Q1 2024 was USD 17.2 million, compared to USD 16.8 million during the same period last year. Additionally, the GAAP loss per share was USD 0.19, while the non-GAAP loss per share was USD 0.10.

Strategic Business Developments: Throughout the first quarter, indie Semiconductor achieved several strategic milestones. These included ramping up Occupant Monitoring System (OMS) solutions for BMW and enabling Augmented Reality (AR) navigational systems for the Cadillac Escalade. The company also secured Image Signal Processor (ISP) wins with a leading Japanese original equipment manufacturer (OEM) for blindspot monitoring and captured significant camera design wins at Valeo. Additionally, indie began sampling highly integrated Radar MMICs and basebands, enhancing its radar technology portfolio. In partnership with Expedera, indie augmented its AI processing capabilities, further supporting Xiaomi’s SU7 electric vehicle launch with multiple user experience solutions. The company unveiled an advanced smart connectivity portfolio aimed at improving in-cabin networking and was awarded contracts for wireless charging sockets by a leading North American vehicle OEM. Furthermore, indie achieved production readiness for a mixed-signal solution for Ultrasonic Intrusion Detection applications at Volkswagen.

Q2 2024 Financial Guidance: Looking ahead to the second quarter of 2024, indie Semiconductor has provided non-GAAP financial guidance, citing the challenges of estimating GAAP results due to variable future events. Thomas Schiller, indie's CFO and EVP of Strategy, projected flat to 5% sequential revenue growth, which is expected to offset market softness resulting from industry-wide inventory rebalancing. Schiller anticipates gross margin expansion to the 51-52% range, driven by a richer product mix and stable expenses, leading to a narrower operating loss. He expressed confidence in returning to a high growth trajectory in the latter half of the year, supported by a robust new product pipeline and market recovery as channel inventories normalize.

Technical Observation (on the daily chart):

The Relative Strength Index (RSI) over a 14-day period stands upward trending with value of 57.58, with expectations of a consolidation or an upward momentum. Additionally, the stock's current positioning is above both the 50-period SMA and 200-period SMA, which may serve as dynamic short to medium-term support levels.

As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Speculative Buy’ rating has been given to Indie Semiconductor, Inc. (NASDAQ: INDI) at the closing market price of USD 6.44 as of May 24, 2024. 

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is May 24, 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.