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MicroVision (MVIS) Stock: Jumps 1,500% on Acquisition by Microsoft Speculations

8/12/2020 Anant Goel

Real billion dollar ideas have multi-billion/trillion dollar market size, they are scalable, and leverage the drivers of growth to go viral or global.

In Part I and Part II of my research on technology companies, I introduced a 20 year old high-tech company that is at the cusp of acquisition by a major technology company. In the last few weeks, this company’s stock price has gone up by 15-fold [from 20 cents to over $3.10] on speculations. Now it is trading in the $1.40 to $1.50 range giving new investors the opportunity to take position; for the future of $30 to $60 dollar trading range in the next six months or so... depending on the acquisition price of $5 billion or $10 billion.


MVIS Stock Reacts to Breaking News 

This Speculation is real... 

The Next Billion Dollar Idea is here…

Company: MicroVision [MVIS]

Technology: Laser Beam Scanning [LBS] PicoP Display Engine, interactive PicoP Display Engine, 3D scanning Engine for short and long range LiDAR, Augmented Reality (AR), and broad base IP Portfolio.

Early this year, MicroVision announced commercial availability of three new engines focused on projection, interactive display and 3D sensing with LiDAR applications.

  • Engine two: is an interactive display engine that integrates display function with 3D sensing function that allows user to interact with projected images [as an embedded interactive display in a smart speaker] with flexibility of multiple product designs.
  • Engine three: is a retinal display engine, for example, in Microsoft HoloLens 2.
  • Engine four: is a mid-range LiDAR engine for consumer applications, autonomous industrial products and robotics.
  • Engine five: is a long-range LiDAR engine for Autonomous Vehicles, a key component of what make the Autonomous Vehicles of the future safe and global.

Market: In addition to interactive PicoP projection and heads-up display (HUD) markets, MicroVision is targeting four noteworthy tech arrivals of the last few years that are gaining momentum, and are expected to experience extremely rapid growth in the next few years.

I’ve talked about MicroVision quite a bit lately, and for good reason. Rumors are surfacing that the company will soon be taken over by Microsoft. Now, I don’t cover takeover chatter and don’t generally write these types of rumors as most of them simply aren’t true.

However, when it comes to MVIS, I’m staying on top of the story as I honestly believe that an acquisition would be in the best interest of both companies. Here are five reasons that I believe Microsoft will offer to acquire MicroVision:

MVIS Stock Going up as Acquisition Hopes Continue

At the end of the day, an acquisition of MVIS would be a great move for Microsoft and there’s quite a bit of evidence that it’s on the horizons.

Here’s why…

Reason #1

Royalties: First and foremost, MVIS holds several patents surrounding the Halo Lens product. As such, every time Microsoft sells the product, it has to turn around and pay MicroVision a royalty. However, with MicroVision’s current market cap, should HoloLens 2 become as popular as many believe it would be, these royalties are going to be in hundreds of millions. By acquiring the company, Microsoft would avoid this issue all together. 

Compelling Evidence of MVIS MEMS LBS used in MSFT Hololens 2

Never Seen Before! Microsoft HoloLens 2 Teardown 

Microsoft's Zulfi Alam explains in detail why MSFT chose MEMS LBS for Hololens 2


Reason #2

Product Manufacturing: Recently, MicroVision announced that one of its customers has taken-on the responsibility of manufacturing key components involved in the Halo Lens product. While the company didn’t say who this customer is, it quickly became clear that Microsoft was the company─ after the US Army provided accolades for Microsoft as a result of their work to speed up the production of HoloLens products.

Reason #3

MicroVision Employees Becoming Microsoft Employees: Interestingly, we’ve seen a major shift of key employees going from MicroVision and heading for Microsoft. Most notably, a senior researcher from MVIS is now a senior researcher at MSFT. Not to mention that the principal hardware engineer of the Holo Lens has also shifted over to Microsoft.

Reason #4

Clear Value Proposition: Another thing to think about here is that MicroVision has a very scalable, valuable and patented IP in the future technology arena. If you don’t believe me, just look at all of the institutions that have gotten involved. Even the Michigan Treasury is getting in on the action with a current holding of 4 million shares.

Reason #5 and #6

MSFT Has Nothing to Lose: Sure, an acquisition wouldn’t come free… but, Microsoft has no shortage of cash. Last year, it generated over $52 billion in operating cash flow, more than $38 billion in free cash flow, and $36 billion in cash flow net of acquisitions. [as of Sep 19, 2019]

Should Microsoft acquire MVIS for a billion or five [pushing MVIS stock in the range of $10 to $50 dollars] , there’s really nothing for them to lose. However, should they decide not to acquire the MicroVision company, they will be losing the opportunity to get their hands on this technology of the future and play in the hands of their competitors (like Amazon, Apple or Facebook).


The Bottom Line

The bottom line here is simple. Everything I’m looking at is becoming yet another reason for Microsoft to pull the trigger on a deal. As I always mention in these situations, there has been no confirmed takeover talks, and rumors aren’t always true. So, be careful. Nonetheless, in this particular case, there’s good reason to expect a deal, and soon.

Finally, we have some major institutions and AWM Investment Company Inc as shareholders. With its choppy 20 year track record, its no wonder why many institutions have stayed away from MVIS. There are lots of companies and techs to invest in. Why choose MVIS with the lack of visibility into its operations.

Investment decisions need to be justified, especially at large institutions. Until there’s more clarity, they will wait and then jump in at the above $5 level when making the decision to buy MVIS is safer and yet still has reasonable upside. You need a rare bird like AWM Investment Company (hedge fund with its early adopter approach and growth management) that’s willing to take the sizable early risk.
[Curated content based on excerpts from posts, blogs, media articles, and sponsored research]
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