Waymo may be primed to become a stand-alone company, say analysts at Morgan Stanley, noting that it could be worth more than $70 billion if it can grow to approximately 1% of global miles driven. That’s assuming the Google unit can put 3 million cars on the road, each driving 65,000 miles a year and earning roughly $1.25 on each mile.
The Lyft partnership could help it get there, they add. Waymo could reach operating profitability by 2022 with its operating margin hitting 8% by 2030, say analysts. Currently, Morgan Stanley’s Brian Nowak doesn’t believe this opportunity is reflected in Google‘s share price. But that’s not necessarily a bad thing: It gives Google room to test its technology before possibly spinning out Waymo.