« Back To Robotics News
Balcones Investment Research Logo

Member Since 2016

LEARN MORE

Investment Research and publication of The Bot Brief.

Content Filed Under:

Industry:
N/A

Application:
N/A

The Bot Brief

POSTED 07/03/2022

"There is no force on earth more powerful than an idea whose time has come."       

- Victor Hugo

 

Bots In the News:Bot Index vs. S & P 500

The rally of the prior week did not last long, and the markets continued to trade in a risk off perspective. The Bot Index retreated 3% while the broad average declined 2.21%. All-in-all it was a terrible quarter for the robotic stocks as the Bot Index fell over 22% for the worst quarter since the inception of the Index in 2016.

There were a few bright spots within the Bot Index. The clear gainers were almost all in the defense arena. Northrup Grumman led the defense group with an almost 5% jump while Raytheon Technologies rose 3%, Lockheed Martin gained 3.45% and AeroVironment jumped 3.76%. The overall best performance, however, came from the 8.78% bounce by Oceaneering International. The company is expected to announce earnings on July 27 and investors will be wondering just how much the strength in the price of crude will impact the report.

There were three holdings within the Bot Index that experienced double-digit declines. The worst performance was the 15+% drop by NVIDIA Corp. The stock was hit by a Bank of America analyst that dropped his price target to $220 from $270. The stock closed at $145.23. Further adding fuel to the burnout was the earnings report by competitor Micron Technologies who cited some slowing in semiconductor sales. The company’s weakness was noted by the Motley Fool who explained, “Nvidia started off the week with Morgan Stanley warning that there could be a potential slowdown in demand for graphics processors as Ethereum, a leading blockchain and cryptocurrency, switches to a proof-of-stake model and away from its current proof-of-work setup.”

Other weakness was noted by iRobot (-13%) and NIO Inc. (-11.29%).

2020's Decade of Bot Index PerformanceCommentary on Agriculture:

Some years ago, we completed a white paper on the investment opportunities within the agriculture community. We noted that arable land was shrinking each year yet the global population was expanding. This fact has not been lost on such wealthy individuals such as Bill Gates. Recently Mr. Gates purchased a $13.5 million tract of prime North Dakota farmland. John Malone is the largest single land holder in the U.S. with 2.2 million acres. Amazon billionaire Jeff Bezos holds 420,000 acres. Clearly, the ultra wealthy recognize the opportunities in the agriculture sector.

Each year farmers need to develop efficiencies to obtain the maximum utility from their acreage. Interesting, farmers have been a major adopter of automation. The Association for Advancing Automation recently issued a paper highlighting some of the statistics regarding robots in agriculture. With labor shortages and costs skyrocketing, farmers are widely using drones and autonomous tractors to fill the personnel gaps. To overcome the finite nature of arable acreage, robotic and AI technologies are being used in vertical farming. This new ‘farm of the future’ is resistant to seasons and can be developed to maximize water and sunlight crop requirements.

The A3 article noted that the global agricultural robot market was $4.9 billion in 2021, however is expected to expand to $11.9 billion by only 2026, for a compound growth rate of 19.3%.

To obtain a copy of our original agriculture oriented investment white paper, please contact [email protected].

 

Member: American Economic Association, Society of Professional Journalists, United States Press Association. Institute of Chartered Financial Analysts, Robotic Industries Association, Member IEEE.

The Bot Brief is a weekly newsletter designed for economists, investment specialists, journalists, and academicians. It receives no remuneration from any companies that may from time to time be featured in the brief and its commentaries, analysis, opinions, and research represent the subjective view of Balcones Investment Research, LLC. Due to the complex and rapidly changing nature of the subject matter, the company makes no assurances as to the absolute accuracy of material presented.