CMBI Cuts Horizon Robotics Target 19% as Firm Chases Nvidia in AV Race

CMBI Slashes Horizon Target 19% But Maintains Buy Rating

CMB International (CMBI) has lowered its price target for autonomous driving technology firm Horizon Robotics (09660.HK) by 18.7% to $10, down from $12.3. Despite the significant cut, the broker maintained its "Buy" rating, signaling confidence in the company's long-term strategy and unique market position. The new valuation is based on a projected 13x price-to-sales (P/S) ratio for 2027, a multiple that CMBI notes is similar to the valuation level of industry giant Nvidia. The adjustment reflects a recalibration of near-term expectations against a backdrop of high potential.

The market reacted with uncertainty to the mixed signals, with Horizon Robotics' stock slipping 1.5% and a notable short-selling ratio of 26.4%. The broker's decision to maintain a "Buy" rating points to a belief that the company's aggressive growth plans and expanding market share in urban navigation solutions justify a premium, even with a revised price objective.

Horizon Raises Revenue Guidance to 60% With 2026 Robotaxi Plan

Fueling the broker's optimism, Horizon Robotics management increased its compound annual growth rate (CAGR) guidance for revenue from 50% to 60% for the next few years. This bullish forecast is underpinned by a concrete product roadmap designed to challenge established competitors. The company plans to launch its "Agentic CAR" cabin-driving fusion system chip this year, with mass production slated for the end of 2026. This timeline strategically aligns with the launch of Qualcomm's competing SA8797 chip, positioning Horizon for a direct head-to-head battle.

Furthermore, Horizon is accelerating its push into the autonomous mobility sector. The company announced plans to begin pilot operations for robotaxis with ecosystem partners in the third quarter of 2026. This move demonstrates its ambition to develop comprehensive autonomous driving capabilities and capture a piece of the lucrative robotaxi market, putting it on a collision course with global leaders.

Competition Intensifies as Nvidia Expands in China

Horizon's strategic initiatives are set against a fiercely competitive landscape dominated by Nvidia. The US chipmaker is aggressively expanding its footprint in China, recently securing partnerships with leading Chinese automakers BYD and Geely to use its Drive Hyperion platform for Level 4 autonomous vehicles. These deals underscore the high stakes in the Chinese market, which is central to Horizon's growth.

While Horizon is carving out a niche with its upcoming solutions, it faces an uphill battle against Nvidia's extensive ecosystem and partnerships, which include major players like Waymo and Uber. The entire industry is consolidating through massive deals, such as Uber's $1.25 billion agreement to purchase 50,000 robotaxis from Rivian. Horizon's success will depend on its ability to execute its ambitious 2026 roadmap and prove that its technology offers a compelling alternative to the solutions provided by established industry giants.