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Sony (NYSE:SNE) has been down so long it looks like up to them.

Once the Japanese darling of tech investors, the company is now languishing at about $11.50/share, having traded at near $40 as recently as early 2010.

CEO Kuzuo Hirai, a veteran of the company's games division, has now had 9 months to start a turnaround. Through most of that period he has been putting out fires. But with the CES show due to start Monday in January he should have something new to talk about.

That will start with a new line of Android phones which unlike those of the past appear to be competitive. The Xperia X and Xperia Z will be sold by AT&T.

Beyond that, Hirai badly needs to reboot the company's PlayStation line. Game consoles have been a declining industry for years now, with most gamers moving to online or mobile games. The current schedule is a February press conference followed by a launch in 2014. It's rumored to sport an AMD (NASDAQ:AMD) chip and support for Ultra HD displays. The new device needs to be good, because Microsoft (NASDAQ:MSFT) has overtaken it with the Xbox and plans its own refresh later this year.

One thing investors should know is that Sony remains the number one maker of movies in the world. Skyfall, the latest in the James Bond franchise, and Spider-Man helped it maintain its lead in 2012 with $4.4 billion in box office, 25% of that in North America. That's about one-fourth of the company's total revenue, and doesn't include TV programming, which is also profitable. The company is working with some other studios - Disney notably not among them - on a distribution service called Ultraviolet that would offer "buy once, play anywhere" capability on Ultra HD movies.

How much would that unit be worth? Consider that MGM, which was its partner in Skyfall, paid Carl Icahn $590 million for a 25% stake in the spring, before achieving a huge success this Christmas season with The Hobbit. Now consider that Sony is a bigger player, which does its own distribution. Thus the market cap of the movie and video business alone could easily be more than half the total market cap of the company, a huge prize that could be sold or spun-out if things continue going south elsewhere.

Sony's biggest problem remains its lines of televisions. Changing the color displays toward more reds and blues for the Indian market isn't going to beat Korea's Samsung or LG. A profile by the Wharton School last month indicated Hirai can still do big things if he can make product decisions quickly, and (of course) if they're the right decisions. He has promised to do just that.

What you're left with, however, is a stock priced to flop. Any major improvement - in games, in electronics, or a sale of the movie business - could spark a fast pick-up in the stock price. Unlike companies like HP (NYSE:HPQ) and Dell (NASDAQ:DELL), which have to reinvent themselves completely as their existing PC platforms expire, Sony only has to execute better within niches it controls. Hirai likes to compare his company with Apple (NASDAQ:AAPL) in the 1990s, and while he's no Steve Jobs he's not chopped liver, either. He really is Sony's best hope.

That makes it a better speculation. If you want to speculate on a laggard in 2013, this might be worth looking at.

Disclosure: I am long MSFT, AAPL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Source: Sony Comeback Try Starts At CES