MVIS: The Future of Display (or at least projectors)

August 18, 2010

Microvision is a company that ANT has been watching for a long time and was once a shareholder in (more on that later when I dig up the data, suffice to say we were to early and lost money).

The company has developed a unique laser based projection technology.  This allows them to develop visual projectors that are much smaller than your traditional board room projector.  Their current product, the ShowWX PicoP projector, is about the size of an iPod and projects a dvd quality image up to 80 inches wide.  The laser technology allows for auto focus which means that no matter how you hold the device (nor where you put it in the room) the picture is alwasy crystal clear; all other projectors require you manually “focus” the image by spinning a knob.  Sales are weak but the company is developing an embedable solutions so OEMs can build projection into other devices.  At some point in the not to distant future this technology will allow screens to be everywhere and in everything (its much more cost effective than LCD will ever be).

Moral of the story, this is a super speculative play but ANT intends to get long this equity in the coming year.  The key constraint so far has been green laser supply (as only Corning makes them) which is necessary to build the projectors.  A second supplier will be coming online soon and that will allow the company to begin making a reasonable pitch to OEMs.

Shares are at $2.50 with a $230m market cap (no debt).  The financial performance is brutal, with ($10m) in operating income each quarter.  The key upside here is that although others are making small projectors (Texas Instruments), MVIS’s technology is the best in class and has the best shot at being the standard embed solutions for OEMS, if that happens this is going to be a much larger company with a strategic asset for a larger acquirer (i.e. Sony).

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