Vuzix Corporation (NASDAQ:VUZI) Is Today's Tech Focus

Vuzix Corporation (NASDAQ:VUZI) was featured for the first time on Insider Financial in this article, wherein it was explained how the company was targeting augmented reality for improving the efficiency of the workplace. The share price seems to be more or less at the same level at which we saw when the first piece was put out. However, the company recently put out a large amount of news, which indicates how much effort is being made by management to show the capabilities of its technology. Hence, the editorial team decided to analyze the company once again. In this new article, we will assess the most relevant news as well as its market impact. But, first of all, have a look at the price action.SourceBusinessWe will review once again the technology being developed, because it is the key to this company. VUZI designs and sells "head mounted displays (or HMDs) in the form of Augmented Reality (AR) glasses, Virtual Reality (VR) glasses, and Smart Glasses". Have a look:SourceWhat is the deal? The glasses contain built-in video screens, audio and sometimes cameras, sensors, and a computer that enables the user to interact by using the Internet. They can work standalone, or as a peripheral to the smartphone. Additionally, this technology has many capabilities of the phone itself and can also run full operating systems, like Alphabet Inc.’s (Google company parent) Android. It is, at the end of the day, "a hands free wearable computer". Furthermore, the Smart Glasses and Augmented Reality (AR) Glasses offer the possibility of viewing virtual 3D computer-generated objects enhancing the real-world views. The company explained, in its annual report, its virtual reality capabilities as follows:

"Our wearable displays can also be used for virtual and augmented reality applications, in which the wearer is either immersed in a computer generated world or has their real world view augmented with computer generated information or graphics as is typical in enterprise applications." Source

What is the market for this product? The applications are very large. But, the company specifies in the annual report that the main target are that professionals working for companies, and consumers. We could see the following applications for workers: "remote camera viewfinder displays and wearable computer displays, viewing of wireless sensor data, quality assurance and assembly checklist, providing hands-free access to manuals and other information and for on-site, in-the-field maintenance, warehouse pick and place, servicing, training and education". Additionally, the company sees that the increasing demand for interactive 3D displays to enjoy contents, such as VR 360 videos, entertainment online, and gaming products, is also being targeted.Recent DevelopmentsLet's review the Q1 2017 earnings release first. The report was put out on May 10, 2017. We had a look and the highlight was revenue of $1.21 million, representing a 233% revenue increase from the Q1 2016. Additionally, the company entered into a $1.14 million development agreement in February 2017 with Toshiba and the production and shipments of the M300 Smart Glasses had already begun. On the side of the balance sheet, VUZI showed, at the end of the quarter, $10.4 million cash on hand, which represents approximately $0.51 cash per share. Additionally, the book value per share shown was $0.74 per share. The fact that the shares are exchanged at the level of $5.82 as of May 30, 2017 means that the market is discounting the future growth of the company. The company used to trade close to $10 a few months ago and things don't change so much in such a short period of time.Let's look at the market reaction now. Note the large volatility, and how the share price went down to almost $5 and then back to $6 in a few days. Also note the large volume.SourceWhat did the CEO highlight? In our opinion, these were the most remarkable words:

"2017 is off to strong start at Vuzix after achieving $1.2 million in sales for the first quarter, which easily exceeded any of our previous quarters since we sold our military division in 2012," Source

What's our take? The company has delivered outstanding growth in the past and the market appears to be discounting this growth. Additionally, the company is still not churning a profit, which seems to be what the market is focusing on at this point in time. In the meantime, VUZI has been working hard to get the word out about its technology. The company has recently attended a number of events.- On May 23, 2017, the LiveWorx Event-ON May 19, 2017 18th Annual B. Riley & Co. Institutional Investor Conference- On May 23, 2017, SID Stifel DSCC Investors Conference- On April 25, 2017, JDA Focus 2017Institutional ShareholdersA number of institutions have take stakes in VUZI:HolderSharesDate Reported% OutValueVanguard Group, Inc. (The)561,993Mar 30, 20172.87%3,287,658Blackrock Inc.270,910Mar 30, 20171.38%1,584,823Bank of Montreal/Can/263,700Mar 30, 20171.35%1,542,644Susquehanna International Group, LLP263,015Mar 30, 20171.34%1,538,637Oz Management, L.L.C.166,400Mar 30, 20170.85%973,439Geode Capital Management, LLC92,972Mar 30, 20170.48%543,886SourceConclusionIn this piece, we learnt the following. The company is doing quite well on the business front as revenue growth continues to improve. In our opinion, the strategy is working out and some smart investors look to be accumulating a position in the market. To sum up, stay on top of the latest developments. We believe the company may surprise the market soon with news and send the stock higher. We will be updating our subscribers as soon as we know more. For the latest updates on VUZI, sign up below!Disclosure: We have no position in VUZI and have not been compensated for this article.