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27
The Artificial Intelligence revolution may be a boon for Intrinsyc Technologies
Posted by: Gerry Wimmer
10/27/2019
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TOP IDEAS: Intrinsyc Technologies sees revenue growth from a wave of orders for its Artificial Intelligence (AI) computing modules that power next-generation, high-tech products.




Investorfile’s share price accumulation target of $1.20 for Intrinsyc Technologies Corp. was reached on March 21, 2016. For the record, we do not revise share price targets for our Investorfile Top Ideas – Small Cap Value Stocks. We have positioned our blog to be one of the first providers of a pragmatic perspective of a small cap company stock's potential worth, where there may be uncovered value that has been largely overlooked by the investment community.


The development of Artificial Intelligence capabilities is driving the commercialization of new high-tech products. It is also driving Intrinsyc Technologies’ revenue growth.

Intrinsyc Technologies Corp (TSX: ITC – C$1.28) provides solutions for high-tech original equipment manufacturers (OEMs) that span a product's development life cycle from concept to production with the ability to offer differentiated products with faster time to market. As such, Intrinsyc designs proprietary computer modules (mostly with Qualcomm processors) that become embedded systems that drive the dedicated functions for high-tech products in new markets including the Internet of Things, smart phones and tablets, drones and robotics, wearable security cameras, in-flight entertainment, auto console computers, medical devices and more.

Intrinsyc Technologies has a revenue model that derives sales from proprietary computer modules and development kits, as well as high-margin engineering services related to those modules and kits for an OEM product development program. As its OEM customers’ new products gain market acceptance, Intrinsyc shares in the commercial success by earning recurring revenues from computer modules sales and/or design royalties in correlation with the production ramp-up.

Artificial Intelligence (AI) capabilities are fast becoming the backbone for new high-tech products in development. AI is the simulation of human intelligence processes by machines, particularly computer systems. These processes include learning, reasoning and self-correction. There is growing evidence that the emergence of AI may be a boon for Intrinsyc’s business, which thrives on new high-tech product innovation.

Over the past several months, the Company announced it has won a multitude of orders for its AI computing modules. From recent news releases:

  • Intrinsyc Technologies signed a supply agreement and received receipt of an order that is valued at US$1.2 million. This initial stocking order is for the purchase of the Company's Open-Q 835 edge artificial intelligence computing modules to be used in a next-generation video collaboration product. Order delivery is expected to occur in the fourth quarter of 2019.
  • Intrinsyc Technologies received an order that is valued at US $1.12-million as a follow-on order is for the purchase of the company's Open-Q 835 edge artificial intelligence computing modules to be used in a next-generation video collaboration product. Order delivery is expected to occur in the first quarter of 2020.
  • Intrinsyc Technologies received an order from a new client that is valued at US$882,000. The order is for the purchase of the company's Open-Q 835 edge AI computing modules that will bring artificial intelligence capabilities to an intelligent medical device. Delivery will begin in the fourth quarter of fiscal year 2019 and extend through fiscal year ending Dec. 31, 2020.

Last year Intrinsyc Technologies had impressive growth. Year-over-year in 2018, the Company reported a significant jump in revenues, growing 24%, setting a new annual record at US$25.7 million. Those results were fuelled by 33% revenue growth from the sales of the Company’s embedded computing modules.

We think the AI revolution is going be a windfall for Intrinsyc Technologies future revenue growth. This will come from the repeated sales of its AI computing modules that power the wave of next-generation products currently in development by the Company’s OEM customers.

That said we have a very positive view of Intrinsyc Technologies’ financial prospects to the end of 2019 and continuing into 2020. With this trend there is potential for ample stock price appreciation by purchasing the stock at its current trading levels.

Investorfile first recommended the purchase of Intrinsyc’s stock at a price C$0.75 several years ago and is on our list of Top Ideas.

Intrinsyc Technologies has approximately 20 million shares outstanding.

Company Website: www.intrinsyc.com

Author’s share ownership disclosure: ITC - Yes


Read Disclaimer:

This article is for informational purposes only. This article is based on the author's independent analysis and judgment and does not guarantee the information's accuracy or completeness. The information contained in this article is subject to change without notice, and the author assumes no responsibility to update the information contained in this article. The information contained within this article should not be construed as offering of investment advice. Those seeking direct investment advice, should consult a qualified, registered, investment professional. This is not a direct or implied solicitation to buy or sell securities. Readers are advised to conduct their own due diligence prior to considering buying or selling any stock.

Investorfile.com is not engaged in an investor relations agreement with Intrinsyc Technologies Corporation nor has it received any compensation from Intrinsyc Technologies Corporation for the preparation or distribution of this article.

The author of this article has acquired and may trade shares of Intrinsyc Technologies Corporation through open market transactions and for investment purposes only.

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Hi Gerry, Your philosophy is focused on principles that have been shown to produce above average results over time and your record has clearly proven that. Congratulations on a great blog and thank you for the hard work that you do in sharing and updating your ideas; it is much appreciated.