This mobile security company will report earnings today, and analysts are increasingly positive.
NQ Mobile Inc. (NQ)
from Unconventional Wealth
Security software on phones and tablets is still a relatively new idea. Chances are, today you don’t know anyone using it. Mobile is the biggest area of growth in the security marketplace—for both sides of the fight.
We have a tremendous opportunity to grab a small company that is leading the cyber security side of the fight—while it is still on sale.
NQ Mobile Inc. (NQ) is the leader in mobile security, bar none. According to the company itself, NQ is responsible for 55% of all security solutions for Android phones. The services NQ offers are comprehensive, covering everything from antivirus, to encryption of data on your phone, safe browsing technology, and anti-theft measures. If you want, you can even take a picture of a thief using your phone’s camera.
America suffered the most cybercrime in 2013 – worth $38 billion. China is right behind, at $37 billion. NQ—which is co-headquartered in Dallas, Texas, and Beijing—has a strong foothold in the two largest markets for its products.
Now, this may be a controversial pick—for one big reason. Last October, the research firm Muddy Waters accused NQ Mobile of fraud—saying the company had overstated its reach in the markets. To which I say, thank you Muddy Waters! That initial report hit the stock price hard – it fell about 50% overnight. But since then, more and more news has come out that makes Muddy’s claims look suspect.
For one thing, Morgan Stanley took a 5% stake in the company—and you know that wouldn’t be the case unless the bank saw the books.
After all, it’s not often you see revenue charts that look like this on sale.
As an added bonus, NQ has a number of “side” businesses. It’s the largest game maker for the iPhone in China (that’s Feiliu in the chart above). And, in addition to the consumer market, NQ Mobile is making large strides into the enterprise market.
In short, we have the top company in an exploding field—growing exponentially—available for a song, thanks to an unfair assessment a few months ago.
That’s the recipe for a big winner. I expect NQ Mobile to make quick strides as it sloughs off the Muddy Waters slur, and then continue its rapid growth as the mobile security market further develops.
Ryan Cole, Unconventional Wealth, www.contrarianprofits.com, 888-811-9492, April 2014