Traffic, Catalysts & Greed & Float

Traffic
Traffic to this blog relative to news and price action has a positive correlation. Often there will be increases in traffic prior to news, sometimes spikes. There have been some significant spikes lately and a steady increase in traffic without any promotion on my part. This is coming from search. 

There is also a significant amount of traffic building from a relatively small place that I think has a significant role in Microvision's supply chain. (this trend has been going on for a long time.)

Catalysts.
For a variety of reasons I believe we're very close to one or more significant market catalysts. By that I simply mean that more people will learn about MicroVision and see its market applications.

I think one of the key place to look is at the developers.

I'm pretty sure they are now seeing references in the code to functionality that's interesting to play with and develop for, that isn't immediately understandable to them. The Apple video of a few posts ago is something to pay attention to.

I have gone to meet with a bunch of voice interactive programmers... you learn some cool things at meetings like that. The right questions get interesting reactions.

I believe the first announcement will result in a cascade of announcements. It pays to be stealthy when you're the only one... as soon as you're not the only one, you don't ever want to shut up about whatever you have.


Greed
Greed is a significant factor in the market.

Shake Shack was once priced at the equivalent of about 50 million per restaurant.
GoPro was once valued at around $10 billion(now at about $1 billion)

(There are more, but at the moment I'm too lazy to dig up the references.)

These are companies that do something cool, but have non-existent moats, and became wildly over valued just based on raging optimism.

Microvision has a significant moat, and the market potential for the LEAST impressive of its businesses is gigantic. (Display only Pico Projection)

See the price target calculator

I left spaces blank on purpose. Replace the stars with your numbers. 

The most common answer I get after showing someone the PicoPro projector, and then asking the question "so what percent of phones do you think will eventually have a projector like this?" The most common answer is 100% or even more than one per phone. (check out old concept video) So, I regard 10% as conservative.

My conservative estimate is 10% of smartphones, $7 per each projector and a PE ratio of 60.

That estimation is absent greed....

Shake Shack, for example once had a PE ratio of over 2000(1225 at the time of the reference above). 

Investors saw potential and paid for it.

If anything, Microvision's potential is under estimated. (Price target calculator, for example, is only considering display only so far.) We can add Near Eye Display, Security, automotive LiDAR, consumer LiDAR, interactive display to Microvision's businesses, and people are throwing money at those markets like crazy. Microvision has been stealthy.

So, as an exercise, go back to the price target calculator, and get just a little optimistic. Go to half of phones & half of the ridiculous number Shake Shack got, and click calculate again. 

Insane? (It's simple multiplication and you can adjust any variable you want.)

Now add the other businesses into the mix....

 This is why I sleep easy at night holding a lot of this $1.25 stock.

Float
The other factor that needs to be considered with this stock is it's relatively small float. 

To estimate the impact of this you can go visit "The Anatomy of a Short Squeeze" post done some time ago.

To do a quick analysis of what this might mean is to think of a single company that may use Microvision's Tech: To draw out of a hat, let's say they put something in an Amazon product.

Here's how that story may play out. Amazon investor sees cool new interactive projector in an Amazon Echo. He thinks, "wow, that has some potential," does a little research and sees the other verticals, and decides to invest some money in this company he just heard about. So, to be conservative, he sells a share or two of his Amazon stock to buy Microvision stock.

To be conservative, let's say that 0.5% of the Amazon shares are sold to make that trade. (one half of one percent.) The market cap of Amazon today (10/2/18) is $980,000,000,000. (divide that by 100 and divide the result by 2) 

The result is a LOT of money that's going to be chasing Microvision's stock. The impact of this could be VERY significant. (4.9 Billion)

Combine that with a company that has a significant number of investors who have been holding it for a long time, because they have done these kinds of calculations... and things could get very interesting.

The Bleeding Edge...

Microvision is making a transition from being on the bleeding edge of technology, to being solidly leading edge.... In my opinion things are about to get really fun.