As a pure-play augmented reality investment, NEXCF stock offers years of technological relevance.
What do fighter pilots, furniture shoppers, neurosurgeons and sports fans settling down in their easy chairs to watch the big game have in common? Increasingly, they’re adopting one of the most profound innovations that have arrived in this century: augmented reality. And NexTech AR Solutions (OTCMKTS: NEXCF) may offer growth investors very compelling exposure to this rapidly burgeoning industry.
But what exactly is augmented reality? To understand the broader implications of AR, it helps to explore a related invention, virtual reality. From Oxford Languages, VR is a computer-generated simulation of a three-dimensional image or environment which can be interacted with through specialized electronic equipment. Naturally, VR has strong implications in the video game industry, as well simulation platforms (race car driving, pilot training, etc.).
However, VR has significant limitations that stymie widespread integration. Primarily, VR requires specific equipment as the 3D imaging is concocted purely within a digital environment. Thus, it’s not convenient for everyday use — unless you plan on carrying a VR headset everywhere you go!
As well, it’s important to realize that VR isn’t compatible for everyone. Indeed, many people of all backgrounds report a condition known as “simulator sickness” — nausea, dizziness, headaches, sweating, fatigue, eye strain and a general lack of balance, according to VirtualSpeech.com. What’s more, some of these symptoms don’t occur right away but manifest later and may last for hours.
Again, the problem comes down to the specialized equipment and the 100% digitalized environment of virtual reality. Long story short, the various receptors in our body become confused when our senses are immersed in a digital environment, while our physical bodies are planted in reality. Granted, many tolerate such discombobulation, but many others do not, limiting VR’s usability.
This is where augmented reality comes into the picture, and is why NexTech AR Solutions, the first publicly traded pure-play AR company, affords tremendous upside potential. Leveraging the digitalization technology of VR, AR platforms juxtapose virtual imagery onto a real-world framework. Better yet, the mechanization of this process doesn’t require fancy equipment — a smartphone will do just fine.
Furthermore, AR is accessible for everyone. Because the imaging visualization occurs in real time and space, your senses are not decoupled, thereby making motion sickness almost a non-issue. As well, the main purpose of AR — to communicate valuable or critical information to the end-user — facilitates broad accessibility and practicality.
Initially, AR might seem like a lofty, fantastical concept but it’s already being utilized — and you may be enjoying the innovation without realizing it!
AR Is Everywhere
More than likely, most passersby associate augmented reality platforms with social media networks. Popular apps from companies such as Snap (NYSE:SNAP) and Facebook (NASDAQ:FB) have dominated the consumer AR discourse. However, not everyone is into putting ridiculous filters on their face — some of us have to work for a living, after all! But AR is much more integrated than we might think.
The best example arguably can be found in the NFL. On football Sunday, millions of fans gather together across bars, restaurants and living room TV sets to cheer on their favorite teams. And with integrated technologies like AR, it’s never been easier to follow the intricacies of the game.
Let’s say the clock is winding down and a running back stretches the ball across the first down marker in a pivotal play. Out comes the chain crew and the officials, determining whether the ball crossed the necessary threshold. On the other end, we viewers recognize this threshold as a bright yellow line.
Obviously, the players don’t see that line. Instead, it’s an instance where AR enhances the viewing experience, helping to vault the NFL into a multi-billion-dollar empire.
As The Franklin Institute (FI) explains, AR technology has across-the-board applications. One of the most conducive uses is in the retail furniture industry. FI explains that “Furniture and housewares giant IKEA offers an AR app (called IKEA Place) that lets you see how a piece of furniture will look and fit in your space.”
Imagine having to decipher the cryptic instructions of Ikea furniture and getting through the process of building out your piece, only to discover that it’s not quite to your liking. AR apps prevent wasted time and money for consumers and instead direct them to products that are appropriate for their context. In this way, sales improve through relevant targeted marketing and loyalty-purchase opportunities through enhanced customer experiences.
But it’s not just retail where AR is pertinent. For example, FI states that military fighter pilots can utilize AR projections “of their altitude, speed, and other data on their helmet visor, which means they don’t need to waste focus by glancing down to see them.” This saves lives on the battlefield, a key political and ideological objective.
Speaking of saving lives, “Neurosurgeons sometimes use an AR projection of a 3-D brain to aid them in surgeries.” In other words, wherever technology in general promotes enhanced use and functionality, AR enables further improvements, resulting in higher sales, safer and more efficient operations, and healthier lives.
The NexTech Difference
According to information provided by SuperDataResearch.com, the mobile augmented reality market generated $2.3 billion worldwide in 2020, while the AR/mixed reality (MR) headset market — products like Google Glass, for example — generated $1.4 billion. By 2023, the research firm estimates that the former segment will hit $2.8 billion and the latter a whopping $4.4 billion.
This dynamic above affords NextTech AR Solutions a considerably robust addressable market. Even more astonishing — and this is a crucial point here — is that the addressable market is forecasted to become much, much larger.
In 2024, Grand View Research forecasts that in the Asia Pacific region, the total AR market (hardware and software) will generate revenue of well over $40 billion. Not to be outdone, BIS Research estimates the global AR/MR market to be worth over $198 billion.
Here are some other statistics to chew on. In 2021, industry experts predict that retail e-commerce sales worldwide will hit $4.93 trillion. By the end of 2023, this figure is expected to soar to over $6.5 trillion. More than likely, the winners in this space will utilize AR platforms to convert viewers into frequent buyers.
Another market to consider which has strong implications for the global AR sector is of course 5G. With breakneck wireless speeds affording a range of connectivity solutions, advancements in telecommunications will only make AR more usable and accessible. In 2020, 5G subscriptions numbered 40 million users worldwide. By 2025, this tally is expected to grow to 2.61 billion, over one-third of the current global population.
Finally, according to research from IDC.com, the shipments of VR and AR-specific headsets is projected to increase by 10.8X between 2020 and 2024. In other words, you’re going to want a pure-play AR investment in your portfolio to advantage one of the still-underappreciated growth narratives.
Granted, these are estimates so you don’t want to get carried away with them. However, at time of writing, the market capitalization for NexTech AR is $307.4 million (390.3 million CAD). From this angle, Wall Street is discounting the company’s upside potential.
In some ways, this isn’t particularly surprising. As I mentioned, current AR platforms are associated with publicly traded social media stocks like Snap or Facebook. Given the stereotypical assumption by older demographics that social media is vapid, it’s possible that AR is suffering from a product evangelization gap.
Further, those who are interested in AR technologies may be doing so by buying SNAP, FB, or Alphabet(NASDAQ:GOOG, NASDAQ:GOOGL) for its Google Glass division. However, the main drawback with this approach is you’re buying into diversified businesses. While that’s neither good nor bad, diversification often mitigates the impact of targeted investments — in this case, you’re betting on AR and other, sometimes disparate businesses.
Also, organizations like Facebook and especially Alphabet are mature institutions. Again, there’s nothing wrong with that per say. But for growth opportunities, you’ll want to explore a streamlined and focused entity like NexTech AR.
As one of the very few pure-play AR investments, NEXCF stock facilitates more than just exposure to a growing industry. Instead, NexTech offers end-to-end solutions for any revenue-generating endeavor, from AR-based marketing campaigns and promotions to platform integration to education and brand evangelization. The possibilities are truly limitless, demonstrated by its massive clientele list. We’re talking names like Johnson & Johnson (NYSE: JNJ), Toyota (NYSE: TM), IBM (NYSE: IBM), Carnegie Mellon University, BCE(NYSE: BCE), NATO and many more.
Moreover, these clients aren’t just happy with NexTech’s services. Rather, they’re integrating them to advance the next stage of their operational endeavors. A prime example is Genie in the Bottle, NexTech’s augmented reality marketing program which was used “to promote a new proprietary line of organic human supplement products developed by Nextech called ‘TruLyfe’.”
According to the company, Genie “is a human hologram, in the form of an interactive dietician, that shares nutritional insights and information with customers who scan the ‘TruLyfe’ supplements QR code through the NexTech AR app.” Combined with the recently acquired AirShow application, NexTech platforms are already scaling into Amazon (NASDAQ: AMZN), eBay (NASDAQ: EBAY), Walmart (NYSE:WMT) and other e-commerce retailers and channels.
Further, NexTech’s key partnerships, such as its deal with BDA Sports to integrate a full-scope AR technology stack, provides organic exposure to viable professional sports leagues such as the NHL, NBA, MLB, and NFL. This will help broaden an already expansive list of clients, including Unesco, TEDx, Dell Technologies(NYSE: DELL), Luxottica, Vulcan Inc., Boehringer Ingelheim, Grundfos, and Arch Capital Group (NASDAQ: ACGL).
For undervalued growth investments with excellent risk-reward profiles, you’re going to be hard-pressed to find anything better than NEXCF stock.
Relevancy to the Pandemic
Of course, the novel coronavirus pandemic disrupted the global economic paradigm, throwing virtually every industry off kilter during the onset of the crisis. One year in, there are still lingering long-term questions about the economy and societal stability, despite the rising valuations on Wall Street.
No one can say for certain how 2021 and the years ahead will unfold. But what is clear is that we’re going to depend even more on technology to guide us through this once-in-a-century pandemic. And that is where NEXCF stock could find itself shooting higher over the next several months due to the underlying company’s incredible relevance.
One of the biggest catalysts for NexTech AR is retail. During the initial strike of the coronavirus, most retail centers outside of essential businesses saw a dramatic implosion of foot traffic. Obviously, the American consumer felt uncomfortable being around hundreds or even thousands of strangers during a health outbreak.
And just because we’ve hit the one-year anniversary of this awful calamity does not mean that people will just flip a switch and go back to their daily pre-pandemic routines. Oh no, far from it. In fact, Variety cited a survey by Deloitte’s Digital Media Trends that found that “Even if they had the option to do so, 71% of consumers said they would not be comfortable going to a theater within the next month — and just over half said they were unwilling to go see a movie in-person in the next six months…”
That’s an alarming statistic which implies that unless retailers everywhere adapt to new technologies, they’re facing a long winter. Fortunately, NexTech AR’s end-to-end solution can upgrade retail clients’ customer-facing interface to accommodate AR, directing buyers to the most appropriate products. Critically, AR platforms also help reduce product returns — a chronic but underreported issue in what has otherwise been an unprecedented e-commerce boon.
Hence, the recent correction of NEXCF stock could be a once-in-a-blue-moon opportunity. Admittedly, the selloff in NexTech shares has been harsh. However, I would carefully watch the relationship between volume and price.
If overall volume declines while the price of NEXCF also falls, this may be a bullish signal to get in. That’s because this dynamic symbolizes that the weak hands have been flushed out — declining volume trends indicates that bearish sentiment is close to being exhausted because there are fewer and fewer weak-handed stakeholders remaining.
This provides a huge opportunity as the door then becomes wide open for the bulls, inviting a robust move up.
Just as importantly, the underlying financial performance of NexTech AR more than justifies taking a shot with NEXCF with the risk-on portion of your portfolio. First, the fourth quarter of 2020 brought home bookings of $7.3 million, representing a 275% increase from the same quarter in 2019. As well, bookings were up 9% sequentially over Q3 results, confirming continued demand despite the Covid-19 disruption.
Furthermore, NexTech rang up $20.01 million in bookings last year – a record haul for the company. This incredible figure is up 235% year-over-year, demonstrating the resilience of AR-based technologies and their relevance in the new normal, especially through facilitating contactless services.
Of note moving forward is NexTech’s 3D advertising solution, which allows users to interact with objects in three-dimensional space. Well before the pandemic, such a platform offered e-commerce companies a sales accelerant — prospective buyers can get the information they need from a retailer’s website rather than “forcing” an on-the-fence customer to go to a brick-and-mortar store to investigate and thereby losing a potential sale.
However, with millions of Americans stuck at home in compromised jurisdictions, there’s never been a more crucial time for e-commerce firms to deliver a comprehensive experience to their customers. NexTech’s 3D innovation provides a ready-to-go answer that will act as a force-multiplier for myriad organizations.
As a result, NexTech anticipates this 3D busines to generate $50 million to $60 million in 2021. With so much meat on the plate, sharp discounts in NEXCF stock only ramps up its long-term growth proposition.
Though the early applications of augmented reality had little perceivable value, those companies that saw the potential of broader AR integration have positioned themselves for incredible gains. One of these could very well be NexTech AR. With its comprehensive services and one of the very few AR pure plays, NEXCF stock is a tremendous opportunity for growth investors.As well, AR has essentially become a necessity. With the Covid-19 pandemic still raging across the U.S. and throughout much of the world, corporations everywhere need effective solutions in order to survive, let alone thrive. AR is the clear answer, potentially driving enormous value to NexTech and its forward-thinking shareholders.
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