If you have any interest in new technology, or a pulse for that matter, then you’re surely well aware that we’ve entered the early stages of a mobile Internet boom. And like the PC or dot-com booms of years past, this emergence of revolutionary technology offers numerous opportunities for investors to capitalize on small, fast growing companies poised to dominate their respective industries for years to come. We believe one such opportunity lies in the mobile software application market. The company currently trades on the OTCBB under the symbol ALIF. And its name is Artificial-Life, Inc.
So without further ado, here are five reasons we believe Artificial Life presents an attractive opportunity to investors:
1. Proven success in the app market.
ALIF’s iPhone download stats are as follows:
-20 (or 95%) of their games have made it to the Top 100 most downloaded
-17 games have achieved a Top 50 rank
-15 have make it to the Top 10
-11 games have made it to the Top 5 or higher
-Best selling game was downloaded 1.8 million times
-Second best selling game was downloaded 1.4 million times
-More than 5 million iPhone games downloads in 2009 alone.
We could go into more detail about their past success, but with more than 50% of their games making it to the Top 5 most downloaded, we’ll assume we’ve made our point.
2. A global presence.
Artificial Life is headquartered in Los Angeles, with its production center in Hong Kong and offices in Berlin and Tokyo. They are one of the few developers well positioned to capitalize on the emerging global app market. Their best games have already reached Top 10 download rankings in 56 countries (ie. 73% of all countries in which the iPhone is officially sold). And on January 14 they signed a partnership with China Unicom to “launch a wide selection of Java mobile games.” Last we checked there were a lot of people in China. Moving on.
3. Genre diversification from games to business to medical apps and more.
While ALIF has had tremendous success with their games, there’s more to the story. They have successfully developed software applications for mobile television, real estate and diabetes glucose monitoring. Not to mention application delivery/distribution software and cutting-edge augmented reality software. In fact, their 2010 strategy calls for even more emphasis in these largely untapped arenas. And reason number #4 may help explain this shift in focus.
4. Equity investment from 3M/Strategic Alliance Agreement.
On October 26, 2009 3M purchased 6,447,491 shares of common stock at $1 per share representing a 10% equity interest. And the President of 3M New Ventures Stefan Gabriel had this to say: “We are looking forward to collaborating with Artificial Life on a number of exciting technology applications in these fast growing markets all across the wide range of 3M businesses.” Enough said.
5. A/R difficulty keeping shares low.
Recently the company has had some difficulty collecting on their accounts receivables. However, management has stated they assume collectability of the receivables. We believe them and assume that this will be a very temporary problem (please do your own DD). However, it has helped keep share prices low, and ALIF currently trades at a PE of just over 6. This for a company who experienced 32% period over period revenue growth, not to mention a major equity investment with tremendous potential for new business opportunities.
So there you have it. One of the fastest growing tech companies, in one of the hottest sectors, for dirt-cheap. What more can you ask for?
Disclosure: We currently hold a position in ALIF.OB. This article is not intended to be investment advice. Please consult a qualified investment professional before making any investment decisions.