Microcap Tech Trader’s “Sound Laser”

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Louis Basenese is out with another bold prediction of a huge winner in the speaker world — and the ad promotes a past pick of his as an indication that he can select these kind of fast-breaking stories successfully.

No one can pick ‘em every time, of course, but we can at least verify that Basenese did indeed actively tease a little company called Uni-Pixel (UNXL) about 18 months ago when he was first launching his Microcap Tech Trader — and that tiny company did eventually turn into a huge winner as long as you didn’t use a stop loss — it went from $6-7 down to $4 and change, stayed down around $4-5 for a year or so, then started to climb dramatically last fall and is now closing in on $30 a share.

Will his next pick have the same kind of record?

Well, it’s not a new pick — this is a stock he’s been touting for a bit over six months.

The basic pitch is that the company has perfected a “sound laser” and is going to change the world of speakers forever — with perfect, immersive sound that’s targeted specifically at a point in space so you can listen to something without bothering your neighbors or wearing bulky headphones. Basenese calls it the “sound laser,” and the company that’s trying to develop this technology and license it out to manufacturers and product designers is called Parametric Sound (PAMT).

I covered this teaser originally when it ran over the Summer, with our piece running on August 2 when the stock was around $10. After that there was a big bull/bear argument over the shares and the stock fell hard to $4 or so, then got touted again by Basenese in December when it was climbing on it’s way back up to $10. Now the shares are well over $15 and still climbing, presumably partly due to Basenese and his continued attention and partly due to the limited progress the company has made in getting deals signed and products developed.

PAMT’s quarterly release to end 2012 (their Q1 2013 report) looks a lot like the quarterly release I first checked out six months ago (their Q3 2012 report) — plenty of promise, no actual revenue to speak of. They sell a few hundred thousand worth of digital signage products per year, but that’s not why the company gets a valuation of $100 million.

The current spike of the shares seems related to three things: First and foremost, I suspect, attention from penny stock trader Timothy Sykes, who called it a hot pick for March partly because of some rumored testing of their technology in McDonald’s restaurants and potential theater deals (the technology sounds like a bad fit for theaters to me, but I don’t really know it well); second, Basenese is still touting it pretty aggressively, as we’ve seen in our email over the last couple weeks; and third, they actually did announce a broad deal with some Chinese companies last week and were apparently pretty optimistic about future deals on their conference call.

Will it come to anything? That I don’t know — as I said last August when I wrote to the Irregulars, I can make a straight-faced argument for these shares being worth $3 or $25 or anything in between, there’s just no way to know and it depends greatly on what happens with deals over the next year or two. They’re not making any money now, so future deals and the potential royalties they might generate if and when products take off will be the key.

Obviously, optimism is running pretty hard today — the stock is up about 20% this morning. Since the company has released no news that I’m aware of, and has not dramatically altered the business (the memorandum of understanding with the Chinese companies was announced a week ago), that boost is probably all from the additional and cascading attention from speculative investors and momentum-seekers who think this is just the beginning.

Will it end badly? Well, I have no idea. Again, that all depends on what the company actually does. If they suddenly get their digital signage technology rolled out to tens of thousands of McDonald’s restaurants that would obviously be huge, but no one has officially announced anything like that and the McDonald’s test could well be just a test in a few restaurants. I assume they test lots of things that don’t end up leading anywhere.

But this is a company riding on expectations and momentum and excitement and guesses — so again, you have to figure out what it might be worth on your own. The technology has been around for a long time, the consumer products announcements from Parametric have so far been pretty tepid, but it’s early days. And the digital signage stuff is an extremely small business even for this small company … assuming, of course, that it doesn’t suddenly roll out to the world’s largest restaurant chain. I’ve never owned the stock, I can see the excitement and the big potential, particularly if their partners can develop a hot high-volume consumer speaker product, but I don’t know whether the chances of developing such a product and having it take off are 1%, 30% or 90%. Or more or less.

Wishy washy enough for you? I don’t have much of an opinion on PAMT, but I’d be happy to hear yours — just shout it out with a comment below.

And those of you who haven't retired yet, check this out as we get to the "planning and forecasting" part of the year...

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20 Responses to Microcap Tech Trader’s “Sound Laser”


  1. PAMT is a stock that brings only hope and promises to the table at this time. If and only if they can get promising deals signed and in the bank and proven technology throughout a variety of market applications and show sustainable revenue growth. I can’t see this company being valued at it’s current market valuation. I suspect the hype is causing the price increase by those who invested cheaply and are looking to hype it up so they can bail out. This is a specialty market and very subject to volatility.

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  2. Good comment on stop loss orders, they have pros and cons and sometimes are necessary for one situation and totally inappropriate for another.

    Besides that, some writers tout them as a “guarantee” against loss. Hardly.

    The sound laser SOUNDS (pardon the pun) like a spectacular idea – if it works, though by inference I agree that theaters certainly doesn’t seem like the best application for it.

    thanks,
    Roger
    InvestLetters.com

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  3. A person who teased UNXL has recently annouced that his current pick is related to the sound technology and they are going to get finance by end of March. This one sounds a similar story. Therefore, I am curious and concerne whether to buy or not.

    Any comments?

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  4. I heard about PAMT too late today to get in on the impressive ramp up that must have been caused by the pump from Basenese. Now I am too cautious to place a buy order this evening. I will see what is happening at the open tomorrow, Tuesday. It is stocks like these that make it very tempting to be a momentary day trader. I have been severely burnt by a faker that did a very exciting pump I bit on when I was quite stupid and did not do my due diligence. I don’t think Basenese is a faker but guessing how long the ramp up will last is beyond my skill. Travis as Gumshoe helps a great deal (I won’t use “alot”) with the DD that he applies. I try to stick with Gumshoe. He may not know everything, but he knows many times more than I. You who are reading this, if you are not yet an “irregular”, don’t be cheap. Sign up! It is truly the best newsletter on the web, and you will enjoy getting the extra help which the irregulars receive.

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  5. The term, “Sound Laser”, implies that the sound is focused in a narrow beam. I’m like Travis – I cannot see why this would be used in theaters. Might be useful at the drive-through window at McDonald’s, but can’t think of any other uses there.

    Here’s a sampling of the information I found by googling “Sound Laser”:

    American Technologies has a similar system called HyperSound.

    You can buy a “SoundLazer” kit from a project on KickStarter (http://www.kickstarter.com/projects/1324892969/soundlazer). The site lists several possible uses for them; personally I feel like the suggested uses are not all that practical.

    Other companies are developing sound laser devices to be used in medical diagnoses [ had to check that diagnoses is the plural of diagnosis ] and would be an adjunct to ultrasound. That seems like a more practical use to me.

    Still other companies are developing, or have developed, similar systems for military use. Crowd control, psychological disorientation, and communicating surreptitiously over long distances are possibilities.

    Considering the number of companies making a similar product, I can’t see investing in Parametric Sound.

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  6. I got super-excited about “Hypersonic sound” something like 10 years ago and bought shares in American Technology Corp to profit from the amazing new consumer products that would come about. Then they went exclusive with DOD and we still have no such consumer products. I hope investors in PAMT don’t have to wait another 10 years for nothing.

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    • Hi Pocket and Everyone:
      Excellent on McDonald’s – and Wendy’s, Arby’s, Burger King, Wells Fargo, B of A and most all others with drive up windows. Otherwise I do not see much use either. To easy to just use a wireless (or wired for that matter) headset at home. Maybe some use for directional sound in an automobile/vehicle but it might get a bit complicated to include two or three vehicle occupants to the exclusion of another. Seems, again, that passengers in a car would be better off with headsets though directional sound would allow them to both listen and speak to one another. As is so often the case: what would the cost be? People like new toys but there is a limit on what they will spend for most all certainly including this “laser” or, better, directional sound.

      As Always: Many Thanks Travis for thorough coverage. Best to All

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  7. to infinity and beyond thanks Louis seriously this would be a great short. I only do options and there is little liquidity and the prices are beyond. Thank Travis always good sluthing

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  8. Hi Travis
    any thoughts on the latest Basenose shout-out re: a mystery mobile apps company? I think it might be Medl Mobile he’s reffering to….

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  9. Parametric PAMT, was a spin off from the other company mentioned above (AMERICAN TECHNOLOGY), for the specific purpose of developing consumer products. The original company is sticking to government projects and crowd control devices while PAMT goes after the rest.

    It all depends on the quality of sound they’re able to generate.

    They’re trying to make surround sound into a single beam generated from a speaker the size of a credit card. If you don’t think that something like this wouldn’t catch on IF it actually works, then you’re clueless. It might take a long time, but it would be a lot more impressive than those cheesy bose wave radios.

    What’s interesting to me is that the majority of
    insiders didn’t seem to want much to do with the spin off (no imagination). But this is where the founder has chosen to focus his efforts.

    I think everyone who says that wired or wireless headphones are a “good enough” solution are completely missing the boat!

    Who would ever want wires or a headset?

    Don’t you remember your transition from a tethered phone to a cordless or cellular phone? Is there anyone out there who would legitimately choose to go back?

    This is NOT a crowded space.

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    • If, if, if, if, coulda, shoulda, woulda. As you admit, Chris. It ALL depends. It all depends on several things that are not there yet and may never be. The sound, consumer expense, reliability, and whether or not they can develop a working omnidirectional laser that will accommodate multiple people in multiple directions. Clueless? Remember that it was by your own admission that they are still TRYING to develop this technology. It is the clueless that invests in unproven (at least in prototype) technology in the blind hope that they will succeed. Research is just that……….research. I don’t mean to be disrespectful to you but different people have different ideas about what makes a company worth the investment. So, for you to call anyone clueless in their views is disrespectful on your part. So back at ya.
      BTW: Yes. It will revolutionize a lot of sound dependent industries IF they are successful.
      Everything from theater to personal line of site communication and more. IF they are successful. Show me a real working prototype and I’m all over it.

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  10. A heart felt thank you for the informative link Louis. I found the last one very informative and reassuring to my opinion on the subject. No one can deny or doubt that the technology is out there. At the same time no one can deny that it is still in development with a long way to go. The point of sale speakers have been around for a while using motion sensors and directional speakers. Nothing really new. The trick is whether or not the technology can be applied to what has been talked about. I’m sure that it can some day. But at what cost to develop? Can it be made viable for the average consumer? Take cell phones for example that were mentioned earlier. I’m old enough to remember when they were radio phones believe it or not. But the technology was semi affordable as it was able to be released in stages to the consuming public as development progressed. This technology however, has to hit the floor running with purpose and application and be affordable. If the hurdle of omnidirectional lasers with the ability of detecting where each person is in order to be effective is developed and cost effective, I can see it as viable. As for person to person communication. For just two points of communication it could work now based on what I know. But when the requirement is to have multiple communication points the same issues arise to be overcome. I think the real world technology is far from being ready and at this time is not a good idea for investment. Unless you want to wait maybe a decade for any real return. OK. Maybe a decade is an over exaggeration but it aint gonna happen over night by a long shot. Again respectfully, different strokes for different folks.

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  11. I have not heard for sure on the use for the Sound Lasar in theaters. I can guess the reason is that they can run two different sound tracks in different languages to two different areas of the theater. Also so a war movie next door to a soft love story with bombs going off in the background can be prevented.

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  12. Old threads never die so long as they still add value…..and I think this one may. (hat tip louis @ 12 above for http://www.explainthatstuff.com/directional-loudspeakers.html)

    About a hundred years ago, I used to be a sound engineer for the likes of David Bowie et al….happy daze. Sound waves travel as….waves. So if you transmit two identical waves, delaying one by 1 cycle (or is it 1/2 a cycle…cant remember), then they mostly cancel each other out. (google: sum and difference microphones) I’m fairly sure this is how background ‘noise’ cancelling headphones work, but havent bothered to research. So all you need to do is transmit an out-of-phase audio signal, (that no one in the room will hear), then cancel/block one or other of the two waves, and the sound will magically re appear and be audible again. Exactly how you do that without some physical/electro device I cant imagine, except, perhaps, by tilting your head so that one ear is further away from the sound source so creates a phase shift (I guess that happens naturally when sitting in your car at McDonalds drive in window and looking sideways out of your car window (Hmmm!?). But if you do need a physical in ya ear device, you may as well use wifi headphones etc. If it doesnt need a physical device, you have a serious problem…..how the heck do you turn the Mona Lisa off !! I cant imagine anyone wants an advertiser whispering in their ear every time you pass an ad or shop. So if this technology really does work, Im gonna make my fortune by inventing something that blocks it. It’ll would sell like hot cakes.

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