Advertisement
UK markets closed
  • FTSE 100

    8,078.86
    +38.48 (+0.48%)
     
  • FTSE 250

    19,601.98
    -117.39 (-0.60%)
     
  • AIM

    752.90
    -1.79 (-0.24%)
     
  • GBP/EUR

    1.1651
    +0.0007 (+0.06%)
     
  • GBP/USD

    1.2492
    +0.0029 (+0.23%)
     
  • Bitcoin GBP

    51,328.97
    -383.95 (-0.74%)
     
  • CMC Crypto 200

    1,381.84
    -0.73 (-0.05%)
     
  • S&P 500

    5,018.29
    -53.34 (-1.05%)
     
  • DOW

    37,910.10
    -550.82 (-1.43%)
     
  • CRUDE OIL

    82.49
    -0.32 (-0.39%)
     
  • GOLD FUTURES

    2,343.10
    +4.70 (+0.20%)
     
  • NIKKEI 225

    37,628.48
    -831.60 (-2.16%)
     
  • HANG SENG

    17,284.54
    +83.27 (+0.48%)
     
  • DAX

    17,917.28
    -171.42 (-0.95%)
     
  • CAC 40

    8,016.65
    -75.21 (-0.93%)
     

Morgan Stanley found 30 ways to invest in the big autonomous driving trend including Domino's Pizza

A new study from Strategy Analytics and Intel predicts the global passenger economy could be worth $7 trillion by 2050.

There are more ways to trade the autonomous driving and electric car trends than you think.

Morgan Stanley shared its favorite 30 stock picks for the emerging technologies with clients that not only include the direct auto-related supplier winners, but consumer and retail names that may benefit from the freed up time and responsibilities.

The firm's "US Research team settled on 30 US stocks, all rated either overweight or equal-weight, across 14 industries, that the analysts believe are favorably exposed to growth opportunities in the execution of a shared, autonomous, electric ecosystem, or are favorably positioned to the adjacent data and content opportunities," analyst Adam Jonas wrote in a report to clients Thursday entitled "The Shared Autonomous 30."

Jonas cited how cars are only utilized 4 percent of the time. In addition, there are approximately 3,500 traffic fatalities per day that could be reduced through autonomous driving.

The analyst is known for having some of the most aggressively bullish predictions on Tesla's ambitions including a note highlighting an Uber-like transport service with autonomous electric vehicles published last year.

"Shared and automated transport also unlocks the more than 600bn hours of driver and passenger time currently spent in vehicles (equal to 68 million years annually), by itself representing an economic opportunity for content and data worth potentially trillions of dollars," he wrote.

Morgan Stanley even included consumer and retail companies Disney, Buffalo Wild Wings, Domino's Pizza and Constellation Brands on its list as second-derivative autonomous driving plays.

ADVERTISEMENT

Disney can profit from higher media consumption due to the more available free time, the report says. While Buffalo Wild Wings and Constellation Brands could thrive because of higher alcohol sales as drivers do not have to worry about driving under the influence. And Domino's Pizza can benefit from lower delivery costs, according to the firm.

For the more direct winners on autonomous driving, here are auto and transportation-related companies Morgan Stanley recommended and their price targets.

1) Magna (MGA)

"Magna-Steyr is in a singularly advantageous position to help new entrants who may want to 'make' their own cars by playing a similar role to what Foxconn does today for Apple in the smartphone industry," the report said.

Morgan Stanley has an overweight rating on Magna with a $60 price target, representing 34 percent upside from Wednesday's close.

2) Schneider National (SNDR)

The firm's "rating reflects an improving truckload demand environment, structural supply tightening from ELDs [electronic logging devices], the secret sauce of the Quest system, technology leadership taking advantage of secular gains from intelligent trucks, and below-peer valuation," the note said.

Morgan Stanley has an overweight rating on Schneider National with a $24 price target, representing 22 percent upside from Wednesday's close.

3) Visteon (VC)

Visteon has the "highest forecast earnings growth of any supplier stock in our coverage. … Cockpit electronics are largely powertrain agnostic and highly relevant in the new business model (shared/autonomous)," the firm wrote.

Morgan Stanley has an overweight rating on Visteon with a $115 price target, representing 15 percent upside from Wednesday's close.

4) XPO Logistics (XPO)

"We are overweight XPO, which we see as the Tesla of Freight Transportation. We like XPO's technology-driven platform strategy that is unique in the space," the report said.

Morgan Stanley has a $60 price target for XPO Logistics , representing 13 percent upside from Wednesday's close.