Zacks has a $1.50 per share price target on NexTech AR based on strong forecasted sales. The stock currently trades in the $0.66 range.
“NexTech AR is a technology start-up and a unique public company pure-play investment in augmented reality. As one of the first movers in a multi-billion-dollar market growing at almost 300% per year, NexTech should be able to grow rapidly as this nascent market explodes,” Zacks analyst Lisa Thompson wrote in a note to clients on Thursday.
“It does not produce hardware, but rather uses AR to improve eCommerce results for customers as well as its company-owned sites. In addition, it uses hologram technology and is starting to apply its technologies to the education and entertainment spaces,” she added.
Based in both New York and Toronto, NexTech is known for its proprietary e-commerce platform, ARitize, which enables retailers to transform two-dimensional images into true 3D AR experiences for consumers.
Bringing AR to marketing
“NexTech AR is the only public pure-play we know of that is providing services to allow companies to use AR in marketing and advertising their goods. At a price to vendors of $30 per month per SKU, adoption of just a tiny percent of the trillions of products sold worldwide will create a massive revenue stream for NexTech AR,” said Thompson.
NexTech has a slew of customers which include IBM, Budweiser, Zoltan David, Block Scientific, Walther Arms, Wright Brothers, Vertical Designs, Touchstone Home Products, and BRNT Designs.
“NexTech is acquiring eCommerce businesses that have standard web sites and then adding AR and/or holograms to boost sales and profitability. This year NexTech purchased two small companies, selling unrelated products, but with positive cash flow and it has already started to improve them. We expect it to continue to buy web sites at low valuations when available,” said Thompson.
“While these company-owned websites are primarily being used for in house testing, we could see the company growing them and ultimately reselling them later at higher valuations,” she added.
The analyst also noted that the company is “uniquely positioned” versus its competition as its platform works with both Apple and Android, while others work only on IOS.
“It can push 3D content to both the web, and an app, while others cannot do both,” said Thompson. “It allows customers to self-publish which others do not. It provides a full range of services from image capture to hosting, and it has expertise in holograms and training allowing it to add more than just basic 3D AR capabilities."
Contact Uttara Choudhury at [email protected]
Follow her on Twitter: @UttaraProactive