Shares of Sensio (TSXV:SIO) are up sharply today after the company announced it had signed an agreement with China-based TCL Multimedia Technology to use its Hi-Fi 3-D and Sensio S2D switch technologies in TCL’s 3DTVs.
Sensio’s proprietary S2D switch is protected by U.S. and international patents. The switch enables users, amongst other features, to change the viewing mode of a 3D feed from 3D to 2D.
Sensio’s president and chief executive officer, Nicholas Routhier said: “We are delighted that our association with TCL is moving forward,” adding, “This agreement with a prominent leader in the industry is a major milestone for Sensio, and it will allow us to start applying our business strategy for the Chinese market. Making our technologies and solutions available to consumers in China is a foremost priority for Sensio, and we expect this agreement to positively influence our next product offerings for this key market in the near future.”
Northland Capital Partner’s analyst Ralph Garcea says Sensio’s 3D technology has the opportunity to become nothing less than a worldwide standard.
Garcea says there are three reasons investors should look at buying the stock today. First, he says, royalty revenue has already started to trickle in with the company’s Vizio and Cyberlink deals, and should grow with today’s announcement. Second, the company’s 3DGO! store will put the company into the mix on the content side. Third, Sensio’s patents establish a base price to its valuation. In a research update to clients today. Garcea maintained his Sector Outperform rating and $1.50 target price on Sensio.
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Garcea points out that TCL is the top manufacturer of TVs in China, having shipped nine-million units last year, and expects to ship twelve-million this year. Nearly 10% of these shipments are for 3DTVs, he points out, a number that could mean $2-million in revenue for Sensio. Garcea also expects the relationship with TCL could lead to content deals for the 3DGO! store.
At press time, share of Sensio were up 15.6% to .37 cents.
Disclosure: Cantech Letter Editor Nick Waddell owns 50,000 shares of Sensio, which he purchased in the open market On Friday, March 2nd and Monday, March 5th.