There’s a pretty good chance that you haven’t spent much of your time thinking about functional materials. As an enterprising investor, however, you could discover serious profit potential with Meta Materials (NASDAQ:MMAT), as MMAT stock offers pure-play exposure to this high-conviction market.
To put it simply, meta materials are a subset of functional materials. The potential applications of meta materials span multiple industries, including automotive, aerospace/defense, consumer electronics, healthcare and energy.
As for the company, Meta Materials, it was brought to the public market on June 28 when it merged with Torchlight Energy Resources. It’s still a ground-floor opportunity, as you’d be hard-pressed to find a more highly focused meta-materials company on the Nasdaq exchange today.
Besides, MMAT stock is currently quite inexpensive. As we’ll see in a moment, though, it has the potential to move much higher.
MMAT Stock at a Glance
Prior to the aforementioned business combination, the stock actually traded under the ticker symbol TRCH and represented Torchlight Energy Resources. In the days leading up to the merger, its share price spiked from $4 to nearly $22.
This may have been due to investors’ enthusiasm about the transition to the new company. Reddit traders also likely contributed to the rally.
As it turned out, the market wasn’t prepared to keep TRCH/MMAT stock in the $20 range at that time. So, the stock tumbled to the $5 area and still trades there as of today.
It’s a positive sign that the stock has stabilized for several consecutive months. Furthermore, if the buyers return and push MMAT back to its pre-merger price of $20 or even $10, today’s investors could enjoy outstanding gains.
A Significant Acquisition
It appears Wall Street simply hasn’t caught on to the growth potential of the meta materials industry. The data is indisputable. In 2021’s second quarter, Meta Materials generated $624,320 in revenues. That was nearly triple the $210,344 it saw in the same quarter last year.
It’s also encouraging to know that, at the end of 2021’s second quarter, Meta Materials had $153.5 million in cash, cash equivalents and restricted cash.
Since the company has remained in a firm financial position, Meta Materials was able to make a recent acquisition which should provide additional revenue streams. Specifically, it acquired Nanotech Security in an all-cash transaction.
Nanotech Security develops nano-optic security features designed for anti-counterfeiting solutions. Its products are used by the government as well as banknote and brand-protection markets.
Impressively, Nanotech’s Quebec-based production facility includes a 105,000-square-foot building with a production capacity exceeding 7 million square meters per year.
That’s only the beginning, though. Meta Materials plans to approximately double that capacity to 15 million square meters over the next one to two years.
Diversifying the IP Portfolio
Not only is Meta Materials acquiring Nanotech Security, but it’s also rapidly growing its intellectual property (IP) holdings. Believe it or not, Meta Materials managed to exceed its objective of reaching 200 patents in 2021.
If we include the company’s issued patents and pending applications, Meta Materials’ IP portfolio comprises 247 patents. The company’s total number of patents has increased by 166% compared to the 93 patents it had at the end of 2020.
These patents are highly diversified. They cover a range of fields which include large-area holographic filtering, scanning holography and light capture for solar panels. Meta Materials also holds patents for transparent metal meshes, non-invasive glucose sensing, radio wave imaging and magnetic resonance imaging.
Patents represent protection of a company’s intellectual property. So, it’s sensible for Meta Materials to expand its portfolio and thereby stake its claim as an innovator in the functional materials space.
The Takeaway on MMAT Stock
Meta Materials is an early innovator in a market with strong growth potential. Yet, it’s actually not a bad thing that Wall Street doesn’t fully appreciate what Meta Materials has to offer.
Currently, MMAT stock is trading at a relatively low price. In the near future, it could become much more expensive. Therefore, investors should consider a position today while Meta Materials is still undervalued.
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On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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