Intel is Buying Mobileye for $15.3 billion (I Win Again)

So, I bought a few shares of the Israeli company Mobileye in late 2014 per my tweet here

 Tweet

The purchase was for my long term portfolio. At the time, autopilot technology was just hitting it’s tipping point and everyone was scrambling to incorporate the technology into their cars. Mobileye’s major customers are car companies like Daimler Benz, GM , Tesla etc and the company sells them computerized camera equipment, sensors and all other stuff that help with auto parking, driver assist braking and so on, basically if you’ve seen an ad of cars that can sense a car in front of them and automatically brake for you, or self parking cars and what not, you’ve seen their technology at work. The company is based in Jerusalem.

At the time I bought shares in them, they were trading at $38 and then for a while they were on an absolute tear, at one point touching $60. Eventually though, profitability concerns and some competition brought their valuation much lower. They dipped below my purchase price and they went nowhere for a while, but since they’re part of my long term portfolio, I held onto them and pretty much ignored whatever the market was doing.

As of this morning then, the news broke that Intel was purchasing the company for $15.3 billion or about $63.5 per share in cash taking me from a minor paper loss to a net gain of 67% on the investment or a little over 24% annualized return, which is AMAZING considering I was at -4% for most of that period. I would’ve been happy to hold them for even longer as I believe they’re at a growing area of the auto industry but a bird in the hand is worth two in the bush so I’m glad to book these returns.

I and millions of former Mobileye shareholders get paid, Intel gets a strategic company to power it’s continued growth in cloud, automotive computing, computer vision etc. Intel is combining the purchase with it’s internal Automotive Driving Group, and the combined organization will be headquartered in Israel so their start up ecosystem gets an even bigger boost and the industry gets some sorely needed acceleration towards fully autopilot cars. Capitalism is fun.

My company can make you returns of around 3% monthly, or 42% annually. Certain terms and conditions apply. If you’re interested in learning more and figuring out how we can help you make better returns on your investment and grow your portfolio, or you just need to discuss your financial goals, reach out to me on twitter @eldivyn

 

 

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