BOSTON, October 5, 2015 /PRNewswire/ --
SoundView Technology Group (http://soundview.co) releases the following market and company update for NXT-ID, Inc. (NASDAQ: NXTD), a biometric authentication company focused on the growing mobile commerce market.
NXT-ID (NXTD $0.80)
We've been holding regular monthly meetings with NXT-ID to more closely track their progress since things are moving much faster now that the Wocket is in production. Here are some recent highlights:
Production ramp: NXT-ID is currently shipping their Wocket in steadily increasing numbers. Revenues are growing rapidly on a sequential basis - from $100K in Q2 to $400K in Q3 with a solid Q4 expected. The company continues to track very closely to our IV model projections which suggest a stock price of $7.47. Our unit sales estimates for 2016 and beyond appear to be low but we will re-evaluate those numbers as we exit 2015.
Expanded distribution: NXT started working with Touch of Modern which is a kind of high-style-geek batch sale site. NXTD also announced that they would be available on Amazon taking advantage of Amazon stocking and shipping services. These new outlets are a measured expansion intended to line up with the ability to build and ship units. As manufacturing capacity expands we can expect to see more distribution arrangements. We still love the idea of using QVC where the value proposition and audience seem like a very good fit.
Influential advisors: Bill Fields has joined with NXT-ID as a senior advisor to help oversee market strategy and distribution. Mr. Fields brings 25 years of experience from Wal-Mart where he rose to position of President and CEO of the Wal-Mart Stores Division. This will bring greater access and expertise in retail distribution. We also like the demonstration of a high standard of corporate governance despite the small size of the company.
Product pipeline: NXTD has released an App that provides customers with tools to update and manage their Wocket via the smartphones. They are also working on EMV-compatible designs for release later this year. Since they have solved what we view as the harder problem in smart wallets they are in a good position to do an easier one like a smart credit card linked to your phone. (This is what many others like Stratos have done.) It's less secure but it is convenient. The Wocket card works at far more points of sale than the others and the company will release a phone/card solution that expands their TAM and probably puts a dent in the opportunity for Stratos and that ilk of product. Card issuers believe they will still be issuing twice as many conventional cards versus EMV in 2019.
Possible bluebird: We haven't focused too much on the biometric side of the NXT-ID business due to all the excitement around the Wocket. However the 3D-ID business is part of the company and has been working with Battelle as a subcontractor on some major military initiatives. Specifically 3D-ID has been selected as the technology to be used for 3D facial recognition. This probably amounts to an incremental $150K to $200K of high margin revenue so it's not dramatic (but is high margin.) However having military-grade biometric technology is an asset in digital wallets and payments. We recount some of the important NXT-ID biometric technology below.
The full NXTD research update (PDF) is published and available here:
Past reports and related research can be found on our website at http://soundview.co/infosec.
SoundView serves as a strategic advisor to NXT-ID and provides this research note for informational purposes only. SoundView does not have "ratings" and is not an investment bank, broker/dealer or registered investment advisor. We've undertaken to research all facts presented here but can make no promises that they are correct or that our reasoning and supporting intrinsic valuation model is an accurate depiction of the future. SoundView employees may have positions in stocks they work on, however at the time of this writing we are not aware of any outstanding positions in the shares of NXT-ID.
About NXT- ID Inc. - Mobile Security for a Mobile World: (NXTD) (NXTDW):
NXT-ID, Inc.'s innovative MobileBio® solution mitigates consumer risks associated with mobile computing, m-commerce and smart OS-enabled devices. The company is focused on the growing m-commerce market, launching its innovative MobileBio® suite of biometric solutions that secure consumers' mobile platforms led by Wocket®; a next generation smart wallet designed to replace all the cards in your wallet, no smart phone required. Wocket was recognized as one of the top technology products at CES 2015 by multiple media outlets including Wired.com. The Wocket works most anywhere credit cards are accepted and only works with your biometric stamp of approval or passcode. http://www.wocketwallet.com/
SoundView Technology Group
Source: SoundView Technology Group
|SOURCE SoundView Technology Group|
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