For the time being, Meta Materials (NASDAQ:MMAT) isn’t getting its due respect on Wall Street. The company has millions of dollars’ worth of purchase orders. Plus, its products have a wide variety of applications, meaning Meta Materials’ revenue should grow over time. As such, MMAT stock has the potential to go into the double digits in five years.
Sometimes, financial traders don’t buy a stock only because they don’t really understand what the company does. Once you understand Meta Materials’ business, however, you may be compelled to take a long position in shares.
You don’t have to be a scientist or an engineer to appreciate Meta Materials’ growth potential, either. There’s risk involved, no doubt. But if you can handle the volatility, investing in MMAT stock should provide some material rewards over the long run.
It’s Perplexing That MMAT Stock Is Falling
Astonishingly, MMAT stock was worth $12 per share at one point last summer. Perhaps this was a result of meme-stock mania. Still, the shares have lost an excessive amount of value since that time.
As of early November, shares are holding just above $1 per share. This seems like an injustice, as the company is one of very few pure plays on the U.S. nanocomposites and functional materials industry.
In fact, Meta Materials is decisively staking its claim in this niche market. Believe it or not, the company has 288 issued patents and 450 “active patent documents.”
Plus, the company is an early and ambitious mover. According to Meta Materials, it’s “one of the first companies to develop proprietary roll-to-roll production equipment to produce large area, high volume nanocomposites.” This means the company can get needed materials to market quickly — and in large quantities.
Traders Probably Don’t Understand Meta Materials’ Business
The downturn in MMAT stock is probably a function of people’s lack of knowledge about what exactly Meta Materials produces. It’s really not hard to understand, though; the company even provides a two-page document that sums things up quite nicely. There’s also a much longer investor presentation if you want to delve further into the details.
The main idea here is that Meta Materials’ nanocomposites and functional materials will be needed in the future for many different use cases. These applications include materials for 5G network connectivity, electric vehicles (EVs), the medical, aerospace and energy markets, the Internet of Things (IoT) and advanced driver assistance systems (ADASs).
Besides this, MMAT skeptics should also observe that Meta Materials received $4.3 million worth of purchase orders for its nano-optic security business. That’s just one part of the company, so there’s no reason why Meta Materials shouldn’t have a much larger market capitalization than it has right now. The company’s current market cap sizes up at around $550 million.
Where Will MMAT Stock Be in 5 Years?
MMAT stock has the makings of a $10 stock. The company isn’t yet fully understood or appreciated by financial traders. Basically, MMAT is a cheap hidden gem that truly has moonshot potential.
This doesn’t mean that you have to load up on shares of Meta Materials. Instead, it makes more sense to start with a small position. From there, expect to purchase more shares during times of volatility and patiently anticipate a hold time of five years for maximum returns.
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On the date of publication, David Moadel did not hold (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.