Technology is consistently evolving, opening new markets and channels of wealth creation. As a primary driver towards economic growth, the ability of yesterday's science fiction to become today's societal reality holds long-term promise for investors able to capitalize on the budding technological platforms transitioning today into practical applications tomorrow. Just as modern-day pioneers such as Apple (AAPL) and Microsoft (MSFT) ushered in the likes of a computerized revolution, the ability of new technologies to open new fields of industry provides opportunities for compounding revenue streams and stable market growth.
Being a leader in one's own untapped industry has an innate advantage of being first-to-market. Such companies are often capable of intellectual property advantages that could hamper the competition. They can often fortify upstream and downstream partnerships with some of the best-of-breed companies before their competition is able to do so. Brand recognition, subsidized growth, and even inflated investment hype can all lead to producing a well-rounded company capable of forging out a large piece of the sustainable market to come. The following companies are just a few names offering investment access into possible society-changing technologies that could open up into uniquely untapped markets.
|Company Name||Market Cap. (2/19/12)||Qtr. Revenue Growth% (yoy)||Industry|
|Corning (GLW)||$20.97 Billion||6.9%||Specialty Glass|
|AeroVironment (AVAV)||$625 Million||26%||Umanned Aircraft|
|Solazyme (SZYM)||$726 Million||92.9%||Renewable Oils|
Corning is a leading specialty glass manufacturer and developer. Despite its seemingly old-world basic material technology focus, the company stands as an unique link necessary for the unraveling of tomorrow's wonders. Already made well known for its proprietary Gorilla Glass which is used in smart phones around the world, the company recently released its new Gorilla Glass 2 which is sure to be the standard of next generation mobile devices. Perhaps a more critical development for the future lies in the company's recent announcement of an equity venture with its long-standing partner Samsung for the development of Corning's Lotus Glass substrate technology.
Designed specifically for enhanced use in organic light-emitting diode (OLED) displays, a future venture with Samsung promises the introduction of numerous market opportunities revolving around OLEDs. Where science fiction comes to life, a near future filled with razor-thin glass televisions, bathroom mirror computers, and electronic windows stands right around the corner in the company's viral YouTube video appropriately titled "A Day Made Of Glass." Despite its seemingly unbelievable concept, OLED technology is literally becoming a reality. None other than Samsung itself recently blew audiences away at the 2012 CES with exhibition of the "Smart Window."
AeroVironment is a pure play industry-leading provider of unmanned aircraft systems. The company has developed drones actively used in combat environments and has even developed systems as unique as an artificial hummingbird. With its common appearance on the news headlines, unmanned drones have begun to take a lead role on the frontlines of the battlefield. Yet perhaps more importantly from a sustainable standpoint, the development of drone technology offers a very practical commercial purpose for the future.
With needs varying from surveillance of oil pipelines to crime prevention to medical transportation, the future of drone technology has yet to be fully explored commercially. With legislation opening the way to this reality, expect to see AeroVironment play a pivotal role in the development of this budding industry.
Solazyme is a leading renewable oils company currently specializing in fuels and chemicals; nutrition; and skin and personal care products. The company creates tailored oils utilizing algae-based technology in combination with non-food feedstocks. Solazyme offers solutions to several global issues ranging from dwindling oil supplies, to heart disease, and even to the limitations to the world's current food production capacity. Capable of creating customized oil profiles that can be used in existing infrastructure, the company's ability to provide direct replacements for petroleum, plant oils, and animal fats provides a realistic addressable market of well over $2 trillion. Yes, trillion with a "t."
For the fuels market alone, the company realistically believes it's able to obtain target gross margins of 30-60% when based upon production costs over time for a built-for-purpose commercial manufacturing facility utilizing sugarcane feedstock. In the midst of developing close ties alongside multiple well-known entities such as Chevron (CVX), United Continental (UAL), Dow Chemicals (DOW), and the US Navy to name a few, the company seems well on its way towards ramping up its production capacity to reach its 500,000 metric tons of production capacity by the year 2015. Investors with a keen eye for foresight and the ability to conceptualize the implications of Solazyme's technologies should undoubtedly have this company on their long-term radars.
Disclosure: I am long SZYM, GLW.