The Decade of Mobile Computing
Board: Value Hounds
I'm convinced that this is the decade of mobile computing: smart-phones and tablets enabling a mobile lifestyle: searching, shopping, entertaining, and paying on the go. But it's not just smart-phones and tablets but a whole ecosystem they exist in: processor cores, graphic chips, wireless communications, GPS, skins for the gadgets, keyboards and other accessories, secure communications, cloud storage, batteries, software galore, retail establishments, online sales, on and offline games, video, audio, slideshows, as well as airline, hotel and dining reservations. Even law enforcement is using it, eyeglass cameras for law enforcement officers on the job to record events in real time (from Taser [TASR]).
As you can gather from the disarray of the above list, I have not done a systematic survey of the ecosystem but my WAG is that it will resemble somewhat The Gorilla Game but likely the market will be an order of magnitude greater than the PC market. There are many more people than desktops! And the BRICs emerging middle classes will be huge. I say "resemble somewhat" because consumer electronics will be more commoditized and less proprietary than the PC business was. But that is not a hinderance for Lynchian multi-baggares.
For close to a year I have been building up mobile holdings for my portfolio, not systematically but opportunistically. I'm staying away from big brand names like AAPL because they simply scare me. How can AAPL possibly be a multi-bagger at this point? It will probably surprise me but it does not matter provided my picks grow as fast or faster than AAPL. After all, it's not the name of the stock that interests me but the value I can get from it.
For what it's worth (the list and a dollar might buy you coffee) my positions:
ARM Holdings [ARMH]: Microprocessor cores. They own the mobile market with low power chips and are moving upscale to tablets, and servers. This darn stock has the habit of not going anywhere for a long time and then becoming a several-bagger. Best played with options. Best tracked on the UK Foolish board: http://boards.fool.co.uk/arm-holdings-plc-arm-50124.aspx?mid...
Mitek Systems, Inc. [MITK]: Secure financial transactions. They are trusted by banks and don't need a new chip (NFC). They scan and interpret images of the documents. Take a picture of the document and Mitek processes the transaction.
Universal Display Corp. [PANL]: Organic light emitting diode (OLED) technologies and materials for use in flat panel display and solid-state lighting. After 25 years of R&D, 2011 was the first profitable year most of the revenue coming from mobile phones (flat screens). A good portion of the revenues are royalties which drop right down to the bottom line. Nice!
ZAGG Inc. [ZAGG]: Shields and accessories for mobile devices. They are the market leaders, sort of the Logitech of mobile.