Although Forbes recently released an article inquiring about the future of NFC communication payments, the technology appears to be here to stay. New technology investment in near-field communication small stock caps companies, combined with upgrades in stock ratings, could boost the near-field communication industry in areas beyond NFC payment technologies.
Santa Ana-based Identive Group’s* (Nasdaq:INVE) (Frankfurt:INV) Multicard unit recently announced the release of the Multicard identity tracking system for educational institutions. The system allows educational institutions, including schools and universities, to verify student identities, track attendance, give student access to student services such as the library, and verify exam results. Schools that use Multicard units can choose which services they’re interested in incorporating into their school or campus. The cards can integrate with current student information systems. This announcement comes on the back of a $2 million funding agreement from Lincoln Park Capital. The terms of the mid-April announcement also disclosed an additional $18 million committed to the effort.
In early May, Identive Group signed a distribution agreement with Avnet Electronics Marketing Americas, a business unit of Avnet, Inc. (NYSE:AVT), which is based in Phoenix, AZ. INVE closed June 6 at $0.80, down $0.15 for the day, with a market cap of $47.65 million. Its 52-week trading range is $0.65 – 1.60.
There are relatively few competitors at the same stock caps level, which could bode well for Identive’s new initiatives. Many analysts believe that the continued growth in all things mobile will help forge the way for growth in near field communications as well. For example, California-based FormFactor (Nasdaq: FORM) recently saw its stock upgraded after recent growth in the semiconductor wafer sector. As a Zacks analyst explained, “FormFactor is an OEM of wafer probe cards used in the back end of the semiconductor manufacturing process. The company posted a narrower-than-expected first quarter loss. Given the growing demand for high-volume low-cost chips that are leading to larger wafer sizes and smaller geometries, demand for probe card sales should continue. The strong growth in mobile devices is also a positive for probe cards serving this segment. We also believe that FormFactor’s decision to shift focus away from the PC DRAM market toward mobile devices will prove to be beneficial in the future. We therefore upgrade FormFactor shares from Neutral to Outperform.” FORM closed June 6 at $6.20, up $0.13 for the day, with a market cap of $327.71 million. Its 52-week trading range is $3.70 – 6.92.
While the concept of NFC payments may be losing its luster against other competing payment technologies, new technology investments in other areas could help offset the loss of NFC as a payment mechanism and might even result in a greater long term payoff. Tablets and smartphones are experiencing tremendous growth and adoption around the world, so it could be a great time to be involved in the NFC communication field.
* Denotes client of Allen & Caron Inc., publisher of this blog