|My mid-year review of MVIS - to be cross-posted, blog going live soon|
INTRO Here's my semi-annual exercise to see if I remember why I own the stocks I own, and so I can check back and see if their stories have changed. I post in case it helps others too.
MVIS (market cap is $2.65B was $0.788B)
MicroVision has finally hit the headlines, which are frequently wrong or incomplete, which means this description might be more useful than usual.
MicroVision is an electronic component company with a range of products based on a simple idea: a chip that includes an oscillating mirror. By oscillating the mirror and properly directing the light the component can be a sensor or a projector or both. Its current high-profile applications are for augmented reality (Microsoft's Hololens, most likely; and IVAS probably), LiDAR (basically radar for driverless vehicles, industrial applications, and consumer uses like automated home security systems), interactive displays (adding interactive video to audio-only smart speakers like Alexa, etc.), and small dedicated displays (like ViewSmart's smartphone with an embedded display). None of the products are as new as the news may suggest. The company has been working on such products and variations for over twenty years. They may have finally made sufficient progress for the market and the rest of the components to have matured enough to produce commercially viable products.
The company's products are considered valuable enough, and the long-term struggle damaged the company's finances severely enough that the company began talking to other companies about mergers and acquisitions. Suggestions are that those talks are making progress, though no details, including timing, have been more than suggestions.
While the company's products and finances progress, the stock has attracted a large cadre of independent investors who see MVIS as an opportunity to profit from short sellers. (One measure of crowd size is the reddit community growing from ~1,000 to over 40,000 users in about a year.) Such investors have shown some success in affecting other stocks (GME, AMC, as I recall). In the first half of 2021, MVIS' share price increased $221%. At one time the increase was over 10,000% in under two years because the share price hit a low at $0.15.
The fact that there are three developments developing simultaneously (products, merger/acquisition, shorts v longs) means trying to fully understand the company's development quickly becomes a lesson in multi-dimensional game theory (or at least something so complex that I don't want to wade through all of the scenarios in my spare time.) The products are estimated to be worth billions of dollars, depending on product acceptance, market capture, and timing. Buyouts typically are decided by finding a buyout package that benefits 51% of the vote, which is not the same as 51% of the shareholders; and can be disassociated from the company's value. Attacks on the short sellers can be independent of the company's value, success, or promise. And then there are factions within each of these possibilities. One measure is relatively easy to understand: in April 2020 MVIS was trading at $0.15. Now, estimates are frequently expecting more than 200 times that, some as high as hundreds of dollars per share. In the meantime the stock is high risk because the products haven't generated substantial revenue, no buyout details have been released, and the short attackers have yet to launch a coordinated and successful assault. Good news is highly anticipated, but until it arrives the stock remains a speculation. Good luck figuring this one out.
At least the company was smart enough to raise sufficient capital to can sustain operations much more confidently that they could for the previous several years.
DISCLOSURE LTBH since 1999 (though the very first shares are gone). My patience has been revitalized thanks to the rocket-like rise from $0.15. Dilution no longer means that I have more than enough if the company finally succeeds and the stock reaches the heights I think are possible. I doubt I'll buy more at these prices, and have shed some shares as bills must be paid.
(I've also collected links to the other discussion boards and my other stocks over on my blog trimbathcreative.net )