Is Ouster, Inc. (OUST) A Good Stock To Buy Now?

Is OUST a good stock to buy? We came across a bullish thesis on Ouster, Inc. on million_sancet’s Substack. In this article, we will summarize the bulls’ thesis on OUST. Ouster, Inc.'s share was trading at $28.22 as of April 24th.

Ouster Inc. (OUST) has emerged as a consolidated leader in the LiDAR industry following its merger with Velodyne, positioning itself as a structurally advantaged technology leader heading into 2026. Ouster has built a more resilient and diversified revenue base across robotics, smart infrastructure, mining, logistics, and industrial automation, unlike competitors such as Luminar and Hesai that remain concentrated in cyclical automotive exposure.

This diversification provides a stable demand profile and reduces dependency on any single end market, supporting more consistent growth through cycles. The company’s core moat lies in its digital LiDAR architecture, or LiDAR-on-a-chip, reducing component complexity, lowering costs, and improving reliability versus analog systems.

Velodyne merger strengthened its position by combining the industry’s largest patent portfolio with an expanded global customer base, creating barriers to entry. In addition, Bluecity software enhances its value proposition by integrating AI analytics for traffic and safety applications, enabling recurring software revenues alongside hardware. Financially, Ouster exited 2025 with record gross margins and is on a trajectory toward positive operating cash flow in H2 2026, supported by accelerating industrial and smart city adoption.

Revenue growth is expected to strengthen as infrastructure contracts convert from pipeline to execution, reinforcing margin durability. Valuation remains undemanding given its positioning within a consolidating sector, with rerating potential as contracts scale and profitability approaches. Risks include execution and macro-driven infrastructure delays, but Ouster’s technological leadership, improved scale, and strong balance sheet position it as a potential winner in LiDAR adoption in the next major growth cycle ahead materially.

Previously, we covered a bullish thesis on Amphenol Corporation (APH) by TMTMoats in March 2025, which highlighted diversified exposure across data centers, EVs, and AI-driven hardware demand. APH’s stock price has appreciated by approximately 138.27% since our coverage. million_sancet shares a similar view but emphasizes Ouster Inc. (OUST)’s LiDAR platform moat, software integration, and infrastructure-led growth across industrial automation and smart city deployments.

Ouster, Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held OUST at the end of the fourth quarter which was 32 in the previous quarter. While we acknowledge the risk and potential of OUST as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than OUST and that has 10,000% upside potential, check out our report about this cheapest AI stock.