Tag - Nanotechnology

NVE Corp. (Nasdaq: NVEC) reported robust third-quarter results after Wednesday’s close driven by increases in product sales and operating margins.

For the three months ended Dec. 31, 2007, the nanotechnology company recorded net income of $1.70 million, or $0.36 per share, a 62% increase over net income of $1.05 million, or $0.22 per share, for the third quarter of fiscal 2007.

Total revenue for the quarter increased 23% to $4.77 from $3.86 million in the 2007 quarter. Product sales increased 25% over the 2007 quarter to $4.25 million from $3.40 million.

“The company would cite that they had a bigger shift in business to sales of products versus contract R&D, but I don’t think that’s the whole story,” David Bayer, head of research at Northland Securities said. “Realistically, one of their key OEM customers that is a medical device company went through an inventory adjustment process and that process is largely done now. That business, which is higher margin, has now picked up for them and will be an important driver going forward.”

Bayer raised his rating on the stock to “outperform” from “market perform” today largely as a result of the company’s OEM customer.

Peaking into the fourth quarter, Bayer says an almost 10% increase in inventories on the balance sheet suggests that the company is building up to meet product demand it foresees in the coming quarter.

“They opened up two new distributors and I think there will be some channel growth,” Bayer said.

In this week’s newsletter watch, we follow a nanotechnology expert on his coverage of Altair Nanotechnologies, Inc. (Nasdaq: ALTI).

Josh Wolfe is a leading authority on emerging technologies, with a noted expertise in nanotechnogy. He is the co-founder and managing partner of Lux Capital, a prestigious group that was chosen by PowerShares to help develop the PowerShares Lux Nanotech Portfolio (ASE: PXN), an exchange-traded fund.

In the latest issue of his newsletter, The Forbes/Wolfe Emerging Tech Report, the advisor reviews PXN's largest holding, Altair Nanotechnologies, a leading player in the development of nano-enabled batteries for use in such areas as the electric car industry.

Wolfe says that electric cars are back on the industry radar and they're looking more promising than ever, but what has changed to make them potentially successful now?

“First, there's the ever-growing economic incentive driven by the steadily rising price of crude oil, now over $90 per barrel,” the advisor says. “Second, and more importantly, is the ever-improving technology. And the latest and greatest innovations in electric-powered vehicles are coming from, you guessed it, nanotech.”

According to Wolfe, if the electric car industry has been stalling over the years, it's primarily because of batteries. Either they're not efficient enough, not light enough, not cost-effective enough or they literally explode from time to time, Wolfe says. Nanotech companies, though, are starting to change all that by developing next-generation batteries, he says, to finally get electric cars on the road.

<p>This week, we feature three advisers who see large potential gains from the &ldquo;smallest&rdquo; of ideas&mdash;nanotechnology. This broad field involves the study and manipulation of matter at an atomic level. Given that this is a new and developing field, investors in nanotech should have a long-term view.</p> <p>For those willing to incur the higher risks of selecting an individual stock in the nanotech space, we turn to two emerging growth experts. First, Gregg Early, editor of The Real Nanotech Investor, considers <strong>Maxwell Technologies</strong> (Nasdaq: <a target="_blank" href="/quotes?symbol=mxwl">MXWL</a>), a stock with a market cap of $246 million, among his favorite speculative buys.</p> <p>&ldquo;The company specializes in a very arcane field, even by nanotech standards. Maxwell is one of the few companies involved in developing capacitors and increasingly, ultracapacitors,&rdquo; he said. &ldquo;This new generation of capacitor has the potential to revolutionize motive and stationary power storage and distribution as we know it.&rdquo;</p> <p>According to Early, the company was recently awarded a contract by Mercedes Car Group to design and produce ultracapacitors for an advanced engineering hybrid-electric drive train program that increases fuel efficiency and reduces emissions.</p> <p>&ldquo;This is also a very good sign for Maxwell because its new CEO, David Schramm, hails from the auto industry,&rdquo; he said. &ldquo;Landing a deal with a major innovator like Mercedes is an optimistic sign of things to come.&rdquo;</p> <p>Early said that the company's technology is also being used in programs with German wind power companies and has also made great progress with power distribution companies in China.</p>

This week, we feature three advisers who see large potential gains from the “smallest” of ideas—nanotechnology. This broad field involves the study and manipulation of matter at an atomic level. Given that this is a new and developing field, investors in nanotech should have a long-term view.

For those willing to incur the higher risks of selecting an individual stock in the nanotech space, we turn to two emerging growth experts. First, Gregg Early, editor of The Real Nanotech Investor, considers Maxwell Technologies Inc. (Nasdaq: MXWL), a stock with a market cap of $246 million, among his favorite speculative buys.

“The company specializes in a very arcane field, even by nanotech standards. Maxwell is one of the few companies involved in developing capacitors and increasingly, ultracapacitors,” he said. “This new generation of capacitor has the potential to revolutionize motive and stationary power storage and distribution as we know it.”

According to Early, the company was recently awarded a contract by Mercedes Car Group to design and produce ultracapacitors for an advanced engineering hybrid-electric drive train program that increases fuel efficiency and reduces emissions.

“This is also a very good sign for Maxwell because its new CEO, David Schramm, hails from the auto industry,” he said. “Landing a deal with a major innovator like Mercedes is an optimistic sign of things to come.”

Despite reporting first-quarter results that topped estimates, shares of NVE Corp. (Nasdaq: NVEC) slid in after-hours trading Wednesday.

For the first quarter of fiscal 2008 ended June 30, the nanotechnology company recorded net income of $1.59 million, or $0.33 per diluted share, compared with $0.9 million, or $0.19 per share for the first quarter last year.

An analyst surveyed by Thomson Financial expected earnings of $0.30 per share for the first fiscal quarter of 2008.

NVE booked total revenue of $4.71 million for the first quarter compared with $3.64 million in the prior-year quarter. The Eden Prairie, Minn.-based company said product sales for the quarter increased 40% over the prior-year quarter to $4.27 million from $3.05 million. 

Shares of NVE traded down 5.99%, or $2.38, to $37.35 in after-hours trading Wednesday.

Nanotechnology, a broad field that essentially means the ability to create specifically designed compounds a few nanometers in size, has for many years been hailed as the next great breakthrough for solving a plethora of the world’s problems. At this size, the electrical, chemical and optical properties of the compounds are radically transformed, promising such things as more efficient electronic circuits, longer-lived batteries, improved drug-delivery systems, engineered biofuels, better lasers and more advanced imaging equipment.

But so far, successful commercial products based on the technology have been harder to find than a nanocrystal under a microscope. Nanophase Technologies Corporation (Nasdaq: NANX,) founded in the late 1990s, has for the last several years been focused on getting real products to market rather than on simply creating new nanoparticles. It has partnerships with BASF, Rohm & Haas Company (NYSE: ROH), health care companies and others, through which it has developed more than 200 commercial products. Those products are now being used to create semiconductors with fewer flaws, better fuel cells, scratch-resistant and microbe-resistant coatings, and even better sunscreens and deodorants.

In April, it announced a new deal with Behr, a premium paint company that is using its nanoparticles to make a paint that resists mildew, has better adhesion and requires no primer. The paint will go on sale at The Home Depot, Inc.’s (NYSE: HD) stores soon. Last December Nanophase also signed a deal with a German company to produce a transparent coating that protects automobile paint from scratching.

Several analysts are hoping that signals a turning point for the company’s profitability and long-stagnant stock. Nikolay Tishchenko at Crown Global Capital, sees the potential for 30% to 50% annual revenue growth for Nanophase for the next several years. “Nanotechnology is breaking out of its limited applications and is at the early stage of exponential growth,” he says. “I like the company’s management and business model.”

NVE Corp.’s (Nasdaq: NVEC) stock jumped in after-hours trading after the Eden Prairie, Minn.-based nanotechnology company beat analysts’ earnings and revenue estimates for its fiscal fourth quarter and year ended March 31.

NVE earned $1.56 million, or $0.33 per diluted share, on revenue of $4.6 million. Two analysts polled by Thomson First Call had estimated earnings per share of $0.27 on revenue of $4.38 million for the quarter.

For fiscal 2007, NVE reported net income of $4.8 million, or $1.00 per share, on revenue of $16.5 million. Analysts were expecting earnings per share of $0.95 on revenue of $16.3 million.

By 7:13 pm ET, shares were up by $4.37, or 14.8%, to $34.00. The company’s stock had closed up $1.80, or 6.5%, at $29.63. It has traded between $12.36 (on June 13, 2006) and $46.35 (on Nov. 22, 2006) in the past year.