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Vuzix (VUZI) Stock Is a Winner, But How Much Higher Can It Go?

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TipRanks
·3 min read
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There’s no stopping Vuzix (VUZI) right now. The smart glasses maker has been on a roll with shares up by a massive 518% over the past 12 months.

However, Maxim analyst Jack Vander Aarde thinks there’s more to come. The 5-star analyst expects 2021 to “mark a significant growth inflection point.”

Vander Aarde rests his bullish thesis on several factors.

First off, the company just released a positive Q4 preliminary update. The company anticipates 4Q20 revenue of over $4 million, representing more than a 100% year-over-year uptick. Following the update, the analyst raised his Q4 revenue estimate from $3.8 million to a matching $4 million.

Furthermore, over the past 30 days, the company’s balance sheet has been given a boost with the addition of $28.6 million, following the triggering of nearly 6 million warrant exercises.

The company is also being recognized by the industry; its Next Generation Smart Glasses (NGSG) recently received 3 CES 2021 awards.

Most important of all, however, Vuzix keeps announcing an “increasing number of positive updates regarding product launches, new customers and new market verticals, and product applications.”

On Wednesday, the company announced a collaboration with virtual care company Hippo Technologies, and earlier this month, medical technology company BioSig Technologies, said it plans to use Vuzix's smart glasses to remotely service some of its devices.

The January wins follow a plethora of new customer additions in December. The list includes Pixee Medical, European resellers, U.S. general merchandise retailers, and “an undisclosed major international defense contractor.”

The abundance of good news results in a glowing review from Vander Aarde.

“We believe VUZI’s long-term potential will only be limited by sales and marketing investment and further production capacity expansion, which will likely take time to further develop to the scale necessary to capitalize on the massive long-term opportunity,” the analyst said.

Furthermore, “[We] believe it would be reasonable for VUZI to trade at a premium to peers, based on our view that VUZI is well-positioned for multi-year revenue growth of 100%+ (which we consider rare) and we believe its commercially ready technology and product portfolio is ahead of competitors, which we expect to result in VUZI having dominant share of the nascent and rapidly expanding AR/VR wearables market.”

To this end, Vander Aarde reiterated a Buy rating on VUZI shares, while doubling his price target from $6.5 to $13. (To watch Vander Aarde’s track record, click here)

Most Street analysts, however, have yet to jump on board. The stock currently has only one other review, also rating it a Buy. The additional Buy means VUZI qualifies with a Moderate Buy consensus rating. Yet, the two analysts expect shares to stay range bound for now, as the current $12.50 average price target indicates. (See VUZI stock analysis on TipRanks)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.