For Smart Glasses Maker Vuzix, 2018 Could Be 'Transformative'

Smart glasses manufacturer Vuzix Corp VUZI could have a breakout year in 2018, according to a bullish analyst.

Smart glasses are touted as a product of the future but have yet to hit a critical mass with consumers or at the enterprise level.

The Analyst

James McIlree of Chardan reiterated a Buy rating on Vuzix with a $10 price target.

The Thesis

Vuzix is coming off a $12.5-million capital raise and signed a three-year supply agreement with Toshiba that's expected to result in at least $5 million in revenue in 2018, McIlree said. (See the analyst's track record here.) 

A strong balance sheet puts the company in a superior position to attract additional strategic partners as the industry continues to see more momentum, with competitor Magic Leap grabbing headlines, the analyst said. 

Demand for Vuzix' flagship product, the M300, is strong, and the company is expanding its VIP channel, according to Chardan.

A key catalyst moving forward will be the company’s latest product, The Blade, a smart pair of sunglasses that weighs less than 3 ounces. Vuzix is expected to highlight its advanced technology at CES next month.

“The Blade is a truly breakthrough product. The company is taking preorders for the Blade developer kit, and the product remains on track for full scale production next year,” McIlree said.

The Blade is expected to have an average selling price north of $800, with the potential of thousands of unit sales next year. Revenue could come in at $1 to $3 million in 2018, McIlree said.

“Smart Glasses technology can become the basis for a new consumer and business platform for communications, and the potential market is extremely large — and has driven private market valuations for companies in the space to multibillion dollar levels,” the analyst said.

Price Action

Vuzix shares were trading up 2.12 percent at $6.02 midday Tuesday.

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The Vuzix M300. Courtesy photo.