Site Network: Home |

Insanity Check

Minus the company's Lumera stake (worth about $38.1M), Microvision is valued at $74M.

There are a lot of reasons why this is so:

--Most people, including most MVIS shareholders, have never seen any Microvision devices in real life. This makes it difficult or even impossible to accurately assess the value of the scanned beam display technology, or put what the company is doing in a real life context that makes sense to investors.

--Market conditions, especially for emerging technology companies, have been really poor.

--The SOXX (Semiconductor Index), which MVIS seems to be pinned to, is close to 52 week lows.

--People are sick of waiting around for something good to happen.

--As of yet there is no proof that the scanned beam display can be commercialized on a large scale and has a ready market.

--People have lost money holding these shares.

--People do not consider the near future, change, and the unknowable in their decision making. Only the known is factored in. History is the only guide.

--People still forget that big cap tech companies each started out as small cash-strapped companies.

--Timelines and projections offered by the company have been missed. People remember stuff like this for a long time and it acts as a filter on their perceptions.

--The company may need to raise funds again in a few months.

--There are some shorts here who have made a lot of money shorting MVIS and won't go away unless there's a pretty damn good reason.

This prompts the question -- how much of this stuff is relevant in 'real reality' to what the company's value really is?

In the words of Donald Rumsfeld, there are known knowns, there are known unknowns, and there are unknown unknowns. Let me try to break things down into these categories to the best of my ability (and let me know if I miss anything):


--Microvision owns $38M worth of LMRA stock which the lock-up comes off of in January.

--Microvision owns 100+ patents on scanned beam display and image capture technology.

--Microvision's Nomad display has been found to increase productivity for auto repair technicians by 30-40%.

--The Nomad is in use by the largest Honda and Lexus dealers in the US, and the fourth largest Chevy dealers. The product is being used by real technicians at real dealerships.

--Nomad is in use in the battlefields of Iraq, where it has been found to increase situational awareness and understanding for vehicle commanders in the toughest conditions imaginable.

--Microvision is in a Phase III contract to Canon to provide consumer microdisplays. A Canon senior executive said: "Canon needs to continue this activity with Microvision to further the development activities for the commercialization of the Microdisplay, and introduce innovative imaging products."

--Microvision is under contract to BMW, VW/Audi, and a Tier 1 European Auto Supplier to deliver advanced prototypes of the MicroHUD heads-up display for vehicles.

--Microvision is under contract to design a laser printer engine using the scanned beam technology for a major Asian manufacturer of printers and office equipment.

--Microvision is under contract to a leading provider of bar code scanning and auto ID products and systems to build a demonstration 2D bar code scanner prototype.

--In September the company raised $10M by selling 1.4M shares to Satellite Strategic Finance Associates, LLC.


--From this Feb 27, 2003 Press Release:

"Mobile handsets and terminals continue to be a focus for our low-cost consumer display solutions. We have recently signed a memorandum of understanding with one of the world's leading suppliers of mobile handsets to explore potential designs for both built-in and head worn displays for cell phones and mobile gaming devices. We have also been awarded a contract by one of the world's leading wireless network operators to develop concept designs and conduct preliminary ergonomics and usability testing of both handheld and wearable mobile devices."

--Aforementioned contract with unknown major Asian manufacturer of printers and office equipment.

--Aforementioned contract with unknown Tier 1 European Auto Supplier.

--Aforementioned contract with unknown leading provider of bar code scanning and auto ID products and systems.

--We do not know when Canon will make its decision regarding the use of Microvision's display technology in their consumer products.

--We do not know when BMW, VW/Audi et al will make their decisions regarding the use of the MicroHUD in their automobiles.

--We do not know when sales of the Nomad to the auto repair market or to the US military will reach significant levels.

--We do not know when sales of Flic will reach truly significant levels (although we are getting there).


--Anything can happen...

It won't take much to get Microvision up off these levels. In the spirit of full disclosure, I will say this: My goal is to accumulate as many shares as possible before the unknown becomes known. I believe that there is a line of demarcation in time -- before Microvision's technology is accepted for use in a consumer product, and after. Before Nomad sales significantly aid the bottom line, and after. Before the value of the company is generally recognized by the world at large, and after.

People may say that there will be a long run-up, maybe for years, after the company has proven their ability to commercialize their technology. And that some buyers think it's better to pay higher prices once the perceived risk of never being able to commercialize the technology is not in the stock.

To my thinking, I'd rather do my homework and figure out that the company and its partners very probably will commercialize the scanned beam display and image capture technology. That way, like Fidelity Growth Fund, Barclays Global and Princeton Capital, I can buy 5 times, 10 times, or 100 times more shares for the same money as somebody who waits around for indisputable proof in the past tense.

I will settle for a rock-solid confidence in Microvision's prospects, borne by countless hours of research, witnessing these products with my own eyes, and staying focused on the big picture trends: ambient intelligence, augmented and virtual reality, and the inexorable, intimate merger of computers and human beings.


At September 11, 2005 at 5:22 PM Anonymous said...

Interesting blog I was looking for canon powershot s410 sites and learned some good stuff here thanks!


Post a Comment

This website does not recommend the purchase or sale of any stocks, options, bonds or any investment of any kind. This website does not provide investment advice. Disclaimer and Notices: Disclaimer: This website may contain "forward-looking" information including statements concerning the company's outlook for the future, as well as other statements of beliefs, future plans and strategies or anticipated events, and similar expressions concerning matters that are not historical facts. The forward-looking information and statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, the statements. The information on this website includes forward looking statements, including statements regarding projections of future operations, product applications, development and production, future benefits of contractual arrangements, growth in demand, as well as statements containing words like believe, estimate, expect, anticipate, target, plan, will, could, would, and other similar expressions. These statements are not guarantees of future performance. Actual results could differ materially from the results implied or expressed in the forward looking statement. Additional information concerning factors that could cause actual results to differ materially from those in the forward looking statements are included in MVIS most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission under the heading 'Risk factors related to the company's business,' and our other reports filed with the Comission from time to time. Except as expressly required by Federal securities laws, MVIS Blog undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events, changes in circumstances, or other reasons. Legal Notice: Although considerable care has been taken in preparing and maintaining the information and material contained on this website, MVIS Blog makes no representation nor gives any warranty as to the currency, completeness, accuracy or correctness of any of the elements contained herein. Facts and information contained in the website are believed to be accurate at the time of posting. However, information may be superseded by subsequent disclosure, and changes may be made at any time without prior notice. MVIS Blog shall not be responsible for, or liable in respect of, any damage, direct or indirect, or of any nature whatsoever, resulting from the use of the information contained herein. While the information contained herein has been obtained from sources believed to be reliable, its accuracy and completeness cannot be guaranteed. MVIS Blog has not independently verified the facts, assumptions, and estimates contained on this website. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on the fairness, accuracy, or completeness of the information and opinions contained on this website. Consequently, MVIS Blog assumes no liability for the accompanying information, which is being provided to you solely for evaluation and general information. This website does not contain inside information, proprietary or confidential information learned or disclosed as part of employment relationships or under nondisclosure agreements or otherwise.