From The StockMasters
On January 4th, 2006 Microvision (MVIS) issued a press statement that they were going to demonstrate their "breakthrough Ultra-Miniature ”Thin Mint” Candy Sized Projection Display" at the Consumer Electronics Show in Las Vegas. The reaction from the news sent the stock soaring.
The technology is amazing, as shown by this savvy group of Saved by the Bell teens. Microvision’s "PicoP" technology allows their ultra-thin, miniature full-color projection display to be embedded in portable hand-held devices (including cellular phones). Just look how silly and fun it is to shine an image on someone’s back! I’m sure the marketing department had a field day selecting the proper teens and entire setup of "Life in a High School hallway" backdrop for these promos. Just look at these kids getting along and having fun with technology. Gone are the days of projectors and slide shows, welcome to the age of cell phone laser-light shows.
The initial excitement has cooled a bit and Microvision Inc. shares have come down in price since January. So now the question is – who will buy this technology? It’s a waiting game folks, just like that unique group of teens that had to wait it out one Saturday morning for four hours. Proving that detention is still detention no matter how much time passes. 
Except it’s going to take longer than four hours for MVIS to find some buyers, more like four months to up to a year. Imagine if you will this technology available on your Motorola Razr, your $500 iPhone, your Palm Treo, or in a few years your Dick Tracy two-way radio wristwatch. Once big companies begin to include Microvision’s Pico projector known as "PicoP" in their products, just imagine what the stock price will do? Of course this is pure speculation, but all the big names were at Electronics Show in Vegas; including Apple (AAPL), Nokia (NOK), Motorola (MOT), Palm (PALM), Ericsson (ERIC), Research in Motion (RIMM),… the list is endless. This product could even show up on your MP3 player, who knows? But you can bet Microvision is talking to the big boys and if one of those companies implements their technology, the rest will follow suit quicker than John Bender (played by Judd Nelson) convinced the others to engage in illegal substances on school grounds, officially forming the Breakfast Club.
What I love about Microvision is if anything happens in that company (like if the CEO sneezes) it’s all captured on the Microvision Blog run by Ben Averch. Everything you ever wanted to know about the company is there, so if you are evaluating buying MVIS’s stock, it’s a great place to do homework. I’m not advocating buying their stock, just take notice of the technology they developed because if it becomes mainstream, look out. Then again, MVIS could go down in flames, no one could buy their technology and a year from now they could be selling their business piece by piece. But even if the PicoP technology doesn’t sell in America, that does not mean it won’t be loved overseas. The EMEA (Europe, Middle East and Africa) mobile phone market is expected to grow 12% in 2007 to reach 400 million units, and if the PicoP is only in 10% of the phones, that will bank roll the company for years. Microvision can’t make a press release until the deals are final with the big boys, so this is all speculation, but if they just get one major deal, hello $5 a share.
However from an ideal stock buying view, MVIS is not a secure or conservative investment. They had a net income of -$7M for Q3 06 and if they didn’t have this promising technology I would stay far away. Microvision’s operating loss from 2003 to 2005 was devastating $94.8M. In January 2006 they threw Alexander Tokman into the role of CEO just six months after joining the company and continue to burn about $5M a quarter in expenses. Microvision has to become profitable before Wall Street will reward them with a higher stock price. So four months from now, if Tokman can land a big buyer for the PicoP, you can bet he’ll have his moment of glory and he’ll be singing "Don’t you forget about me".
Article written by: Frank Lara Jr.
Article posted on: February 5th, 2007
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