Why MicroVision (MVIS) Is Up Today

NEW YORK (TheStreet) -- MicroVision  (MVIS) exploded on Monday on the news it will supply its PicoP technology to UPS  (UPS).

By midmorning, shares had added 19.3% to $2.41. Trading volume of 7.4 million was nearly double its three-month daily average.

In a statement, the nano-cap said it would provide the package-delivery company with its projector modules to improve its real-time package-sorting system.

"As the leader in logistics handling high volumes of packages every day, UPS is the ideal company to deploy advanced projection capabilities to improve package handling processes," MicroVision president and CEO Alexander Tokman said in the release. "We are confident that MicroVision's PicoP display technology will aid in accuracy and increased efficiency."

The Redmond, Wash.-based business said it had custom designed the display technology to project information directly onto the packages.

"Because the size of packages coming through the sorting process vary greatly, the infinite focus and variable field of view projection of PicoP display technology make it well-suited for this application. The overall brightness of the laser-based projector module provides easy visibility for the package handlers," the company explained in the statement.

Last month, MicroVision shares surged on news Sony (SNE) would use PicoP technology in its new projector module. Sony's project, a pico projector module, will have HD resolution, incorporating MicroVision's PicoP technology which allows image and video to be projected from mobile devices.

In a statement, Sony said the technology allows "crisp, beautiful high-definition resolution and "focus-free" projection, regardless of the distance or angle from the projection surface."

"By combining this module with Wi-Fi components and a battery, it can realize a compact, pocket-sized projector which can be used to project images from products such as smartphones or tablets, focus-free and in even higher resolution, on any flat or curved surface such as a wall or desk," Sony added.

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TheStreet Ratings team rates MICROVISION INC as a Sell with a ratings score of E+. The team has this to say about their recommendation:

"We rate MICROVISION INC (MVIS) a SELL. This is based on a variety of negative investment measures, which should drive this stock to significantly underperform the majority of stocks that we rate. The area that we feel has been the company's primary weakness has been its unimpressive growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Electronic Equipment, Instruments & Components industry average. The net income increased by 4.6% when compared to the same quarter one year prior, going from -$3.85 million to -$3.67 million.
  • MVIS, with its very weak revenue results, has greatly underperformed against the industry average of 2.0%. Since the same quarter one year prior, revenues plummeted by 63.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • Net operating cash flow has slightly increased to -$3.65 million or 7.26% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -8.68%.
  • Investors have driven up the company's shares by 25.47% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the future course of this stock, we feel that the risks involved in investing in MVIS do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
  • MICROVISION INC has improved earnings per share by 13.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, MICROVISION INC continued to lose money by earning -$1.15 versus -$2.64 in the prior year. This year, the market expects an improvement in earnings (-$0.40 versus -$1.15).

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