not Saul but see post 6451
The corporate goal has to be to make money eventually, increasing sales won’t be enough if you lose money on each item sold.I own some AIOCF but don’t see much of a moat. Or any real reason why a Canadian company can compete in manufacturing costs, so the profit will have to come from the integration and software side.
I am in the stock mostly because I think the sector and underlying business has great growth potential . That is not enough reason to have a big investment in AIOCF. It is not a high conviction stock for me. But I did add a bit this AM, based on the principle that the earnings report did not alter the underlying thesis. But if AOICF doesn’t start making progress towards earnings soon I will sell.
But if AOICF doesn’t start making progress towards earnings soon…
Hi Mauser, Are you and I looking at the same stock? Their earnings for the full year 2014 were 80 cents, up 33.3% from 60 cents in 2013. And that was up from 22 cents in 2012! Their earnings in the Dec quarter were 25 cents, up 31.5% from from 19 cents, which in turn was up from 8 cents in 2012. What in the world are you talking about when you say that?
Saul
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You are right Saul, I don’t know what I was thinking. (my mind was elsewhere)
Strike the whole post
Whatever, the market wasn’t excited about the earnings report/
The corporate goal has to be to make money eventually, increasing sales won’t be enough if you lose money on each item sold.I own some AIOCF but don’t see much of a moat.
Mauser do you know of any other company that has an end to end solution? All the way from cameras to analytics?
Andy
I own some AIOCF but don’t see much of a moat.
That fat portfolio of patents and patent applications would be considered a rather wide moat by most investors. Tech companies don’t build these portfolios just for giggles. They do so in order to protect their intellectual property (IP). I worked at Boeing for 30 years. They had a large dedicated staff whose entire mission was the management of Boeing’s IP. Boeing has a significant revenue stream generated from IP licensing agreements (many of Boeing’s patents have noting to do with aircraft and flight, Boeshield T-9 for example is a commercially available anti-corrosive/lubricant coating).
Fact is that Aviglon has patents covering just about everything from soup to nuts in the video security arena. Of course, it’s possible for other companies to provide similar functionality with different technology, but that requires a lot of R&D and they still run the risk of patent infringement. In case you haven’t noticed, patent cases are a pretty active area of corporate litigation these days.
I’m long AIOCF and plan to get longer. They are rapidly expanding their product offerings from surveillance and forensic analysis to preventive products and new functions such as access control. As I see it, Aviglion is covering the waterfront, while their competitors offer niche products.
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Great post on the grid Brittlerock. No doubt most but not all utilities will fight the idea of an intelligent grill too. Troublesome new ideas , they are already making guaranteed profits the old way. I would be interested in a post about further reasons why some utilities seem to be cooperating with solar.
I do not trust patents unless I have read them. Most patents are at most a stumbling block,something to slow competitors down … In some cases patents tell competitors where to look. That’s why some companies (Coca Cola relied more on trade secrets.Which can be stolen but don’t expire. And don’t enrich lawyers at the expense of everybody else.
There are exceptions. Some that come to mind are Xerox, Polaroid, Intuitive Surgical, Arcam. Those patented something basic- Intuitive Surgical the simple idea that cables (much like human tendons) being used to articulate the robotic fingers. Which seems so obvious that it couldn’t be patented, but it was.
Boeing patents didn’t keep Air Bus from becoming a very viable competitor
BTW the patents with above tight tech are not hard for a layman with a scientific background to understand… In case of one of the above it was an electron beam, in another cables, in another electrostatic charges.
I have not read Avigilon patents. But the fact that unlike ISRG they do not dominate the industry indicates that the patents do not cover core technology. In any case I see that eventually software and integration will be the key here. And these are hard to patent.
I did add a little more AOICF yesterday. The Surveillance Society is coming, in a far more sophisticated form than Orwell predicted, so I might as well try to make some money off it.
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Well - books have already been written on patents, copyrights, trademarks and trade secrets so I’m not going to belabor the point. As you pointed out, some patents offer better protection than others. My father was a designer, he held several all but worthless patents - worthless from the perspective of providing protection for his designs. He knew it. Unless there are absolutely critical dimensional aspects to a design, a patent offers little protection. So why did dad spend money on patents when he knew they would offer no protection? They had PR value that exceeded their cost.
The story between Boeing and Airbus is not a story that involves patent protection to a great degree. Five European nations did not like buying all their commercial airlines products from US suppliers (not just Boeing at the time, MacDac was still a separate entity and if I’m not mistaken Lockheed was also still in the business when the Airbus consortium was formed). As noted before, Boeing patent portfolio generates a lot of revenue from licensing agreements.
How many of AOICF’s patent portfolio offers protection? Exposure? PR? Nothing at all? I couldn’t say. How many trade secrets do they with-hold from the patent office? Got me there - I assume there are some. Whatever the actual numbers are, I credit the IP as creating a moat for them. Maybe I give it too much credit, maybe you give it too little.
But even setting the IP aside, they cover the waterfront with their product offerings. They integrate easily with existing analog devices. They are coming up with new uses for their products in order to open new markets . . . I don’t know their competitive landscape all that well, I’m pretty well satisfied that no other company comes close. That, in and of itself is a moat that is hard to cross.
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Oh yeah - I got more to say about the grid and our electrical systems in general - but this thread doesn’t seem like the right one for it.