Why Investing in SMART Technologies Is a Wise Move

By David Dispennette  AUG 05, 2010 7:50 AM

The company's initial offering was the interactive whiteboard, but it has evolved to include numerous technologically advanced products.

 


This will show my age, but I can remember sitting in a theater thinking how cool it was to see the DeLorean in Back to the Future. Not only did it further elevate the consumer awareness and demand for the DeLorean overnight, setting time-travel feasibility aside, it also introduced the idea of powering a car on something other than gasoline, which most dismissed as a kooky notion at the time.

How about the first time you saw a cellular phone in a movie? For me, it was Wall Street in 1987.

More recently, perhaps you remember the flurried use of biometric screening technology in the early millennium in movies like I, Robot or The Bourne Supremacy.

While movies are most often a far cry from reality, they can sometimes foreshadow technology of the future. The most recent examples of which are SMART Technologies' (SMT) products. I remember seeing Minority Report (2002) and thinking how great it would be if you could really stand in front of a wall-sized computer screen and move images and data around to see everything at once.

Fast-forward eight years and that technology is a reality…and it’s available, or will soon be, in your child’s school.

With the touch of a finger or pen, the SMART Board interactive whiteboard allows you to run computer applications, write notes, display images and search the Internet -- basically everything you can do with your computer, but at the touch of a finger. While there's much discussion in education today about catering to the various learning styles children have, with the SMART Board:
 


Today, there are more than 1.6 million SMART Board interactive whiteboards in classrooms and offices worldwide. While SMART’s product offering started with the interactive whiteboard, it has evolved to include other interactive products such as interactive displays, interactive tables, interactive pen displays, student response systems, wireless slates, audio enhancement systems, document cameras, a full line of interactive learning software and conferencing software. Globally, SMART sold just over 360,000 SMART Board interactive whiteboards in 2009 -- a record yearly total for the company and an increase in sales of more than 60,000 interactive whiteboards over the previous record established in 2008.

SMART Technologies began trading on the NASDAQ under the ticker symbol "SMT," on July 15, 2010 at $17 a share. As you can likely tell, I believe this is a strong company and strong product offering that could reward investors nicely. I view it as a long-term play and bought a piece of it for myself and in The Stock Playbook portfolio on it's IPO at $16.80. As I wrote at that time:
 

They priced the IPO at $17 and I feel an entry here will be rewarded nicely with patience and eventually, a market that trends higher. As always, you need to have a mental stop/loss in place, but with an IPO, you need to give it a little more room. So if you aren’t comfortable riding this thing down to $14, I’d only establish half at these levels and add remaining half on a pullback.


The key word in that alert was "patience." As I suspected, the stock did retreat through the $14 level and is currently trading at $13.50. With earnings expected to be reported on August 12, I feel this is an opportune time to establish or add to a position in SMART Technologies.

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Position in SMT

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