"Your product or service is ready to ship when it promises a commanding new value proposition that pushes the state of the market to the next curve. Your revolution has to be at least 1,000 percent -- ten times -- or an 'order of magnitude' improvement."
-- Guy Kawasaki, former chief evangelist of Apple
Truly revolutionary companies don't just come up with new ideas or products; they drastically change and shape the way business is done within their competitive landscape. Apple changed the way we purchased music and thought about operating systems, and then it surged ahead with the advent of the iPod and iPhone. Wal-Mart did so by using tremendous supply chain management and massive purchasing power in order to offer customers heavily discounted items. Both of these companies have been revolutionaries in their fields, and both have rewarded shareholders immensely.
The ability to find the next revolutionary company can wipe out any losses you might have incurred with other stocks. It can change your thinking, and best of all, it can transform your portfolio into a money-making machine in one fell swoop.
Today, I will tell you all about that one life-changing company and then provide you with a brand-new free report that identifies The Motley Fool’s top stock pick for 2011!
The last revolutionary stock
On May 7, 2010, I wrote an article revealing what I thought was the next revolutionary stock: IMAX (Nasdaq: IMAX ) . Since that time, IMAX shares have popped by 85%, while the S&P 500 index has gone up by 20%. IMAX had several of the traits that I like to see in a game-changing company, among them:
- It had a technological advantage over its peers and had a first mover advantage.
- It had increased revenues over the past year.
- IMAX changed the way consumers viewed its industry.
In the time since I wrote that article, IMAX has continued its dominance in the 3-D realm. With only limited competition from RealD (NYSE: RLD ) , IMAX is able to control the way studios and theaters operate and has a business model that proves it. IMAX has high fixed costs upfront, but then it reaps variable rewards as box office hits pour in and IMAX's network of theaters grows. Speaking of growing, IMAX recently inked a 75-theater deal in China, has expanded into Russia, and has continued to grow its backlog in the United States.
Another stock to add to the list
Today I want to introduce you to NXP Semiconductors (Nasdaq: NXPI ) , a company that was part of electronics mammoth Philips for more than 50 years but just had an IPO in mid-2010. Similar to IMAX, NXP has several of the key ingredients to being a revolutionary stock:
- It has a clear technological advantage with near-field communication, which it helped to invent, and now markets its NFC chipsets to a vast majority of big-name companies.
- It has increased revenues over the past year by more than 25%.
- NFC could easily change the way people use mobile devices in all aspects of their lives.
NFC is a short-range communication technology that can be used in smartphones to streamline mobile ticketing for public transportation, electronic ticketing, identity documents, mobile commerce, electronic keys, and much, much more. Imagine you're shopping at a store and find something you like -- you wave your phone at the item and immediately see comparative shopping stats, pricing info, and product details. Imagine you never have to hold a car key again and instead just swing your phone near the door and it magically opens. These are the types of life-changing ways in which NXP's chips could be utilized in the future.
To be up-front, NXP is a total turnaround story. The company hasn't been profitable since 2004 and has a heavy debt load, albeit one that it can probably handle. The beauty of this situation is that after being taken over by private equity firm KKR in 2006, costs have been slashed and a new management team has been put in place. The company is now in a much better position to take advantage of the smartphone boom and to battle competitors like STMicroelectronics (NYSE: STM ) and Inside Secure (in which Qualcomm (Nasdaq: QCOM ) has made an investment).
NXP has already proved itself a major player despite only recently going public, illustrating that its years of expertise gained at Philips is well-recognized. It is the exclusive provider of NFC chips for the world's largest handset maker, Nokia (NYSE: NOK ) , has made deals with Sony, and has a great chance of being an integral part of all future smartphones since Google's (Nasdaq: GOOG ) Android operating system supports NFC as well.
Get in before everyone else does
NFC is clearly a technology that will move the market to the next curve. Fortunately, consumers are ready, the foundation has been built, and companies all around the world are pushing for its immediate acceptance. The best thing you can do is to get in before everyone else does -- because this stock is one that won't hang around for too long.