Munster: iRobot 'Sweeps Away Competitive Threats'

Wall Street analyst turned venture capitalist Gene Munster is closely following iRobot Corporation IRBT which marks a notable shift away from the two mega-cap giants he follows, Apple Inc. AAPL and Tesla Inc TSLA.

Despite a comparatively small $2 billion market cap, iRobot is an "important company to follow" because it's a true pioneer in the home robotics space, the co-founder of Loup Ventures told Benzinga during a visit to the Detroit newsroom this week.

iRobot is projected to sell around 3.5 million cleaning robots this year, which would bring its total penetration so 5 percent of households, Munster said. iRobot has a large opportunity to grow inside the house as well as outside, as management has been hinting toward releasing a robotic lawn mower.

"The driving catalyst to increase robot adoption is increasing consumer awareness, and as consumers become more comfortable with robotic vacuums, this will cause increase demand for other domestic robot categories (mops and lawnmowers)," Munster said in a blog post.

The domestic robot category will likely see double-digit unit growth annually over the next 10 years. By the year 2025, there will likely be 26.5 million domestic robots — a $5.7 billion market opportunity, according to Loup Ventures. 

iRobot is well-positioned to dominate in the vacuum and wet floor cleaning category, but its leading robotics expertise will "unlock many opportunities in other domestic markets," Munster said. 

iRobot Corporation was trading down 9.33 percent midday Wednesday.

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Photo courtesy of iRobot Corp.