The following article is exclusive content from The Motley Fool. While this is typically paid content, we are bringing it to you free because we think it is especially pertinent to your ability to invest wisely. Mobile sensor developer InvenSense (NYSE: INVN) has shown positive, consistent movement since going public, and looks to be a good bet for the foreseeable future. Below you will hear from one of our newsletter analysts about why InvenSense has the perfect product at the perfect time, and what that means for investors.

InvenSense, a leading designer of motion tracking sensors, processors, and software, has been a big winner since its IPO at the end of 2011. The stock is up about 70%, outpacing the market by almost 30 points. The best part is, the stock is really just getting started. To understand why, let's set the stage with a great quote from legendary investment manager Ralph Wanger:

If you're looking for a home run -- a great investment for five years or 10 years or more -- then the only way to beat this enormous fog that covers the future is to identify a long-term trend that will give a particular business some sort of edge.

Identifying the long-term trend that will drive InvenSense's growth is easy: the demand for data is insatiable. Data is driving everything from business decisions to customer experiences. More and more data is coming from various devices like smartphones, tablets, and wearable technologies via micro electro-mechanical systems or MEMS. As the demand for data and sensors continues to increase, InvenSense stands to profit handsomely. Below are three reasons why InvenSense's top line, and stock price, will continue to grow, grow, grow.

1. Billions of mobile devices will need billions of sensors
According to research firm IDC, more than 1 billion smartphones and tablets will be sold in 2013. Jump ahead to 2017, and that number climbs to more than 1.8 billion. Yes, mobile devices are the future of computing. Today, virtually all of Apple's products have some sort of sensor in them -- from MEMS microphones to accelerometers and gyroscopes. In fact, Apple even designed a special motion process for its flagship iPhone 5S. So I expect to see more sensors, not fewer, going forward.

But that's not the case with all mobile device makers. According to InvenSense CEO Behrooz Abdi, most OEMs have specialized sensors in about 40%-60% of their products. The combination of more sensors making it into more mobile devices provides a huge tailwind for companies like InvenSense in two ways. First, InvenSense's products have become the de facto standard for Android-based phones. The company has a great working relationship with Google; so much so that Google put InvenSense's algorithms into the kernel of Android. That means OEMs can simply drop the sensors into the phone and instantly have full functionality. As a result, more low-end smartphones and tablets are adding sensors to their devices, and driving incremental growth at InvenSense. Also, InvenSense is gaining market share from existing customers. Abdi recently commented that the company continues to gain share with its largest customer and smartphone leader, Samsung, who also happens to be the leader in mobile devices. And with sensors only being in about 60% of its products, according to Abdi, InvenSense has plenty of room to grow its business with Samsung.

2. More higher-value sensors from InvenSense
Management clearly feels the wind in its sails, as sensor sales to mobile device makers is by far its largest segment today. InvenSense is keeping its foot on the accelerator pedal. At two recent investor conferences, CEO Abdi said that InvenSense sells just over $1 of product into each mobile device. He expects that number to grow to $2-$3 of product over time. That being the case, InvenSense's market opportunity will grow from about $1 billion today to $2 billion-$3 billion over time.

Here are the three ways InvenSense will grab more and more of that growing market opportunity.

  1. Higher-order combination sensors
  2. New places for sensors within the device
  3. Acquisitions like ADI's microphone business

InvenSense's technology platform was built on the back of combining sensors together with processors into a single, small, low-power consumption chip. For example, the company's six-axis solution, which puts an accelerometer and a gyroscope together with a processor, accounts for about 50% of the company's sales today. That is the direction the market is going. Customers want higher-order sensors (six-axis, nine-axis, and 10-axis) with better processors and algorithms to help devices become contextually aware of a user's actions. InvenSense has the platform to meet the challenges, differentiating itself from the competition and enabling the company to grow faster than the market.

In addition, InvenSense and others are finding new places for sensors. Cameras on mobile devices are becoming a more important feature. People want to snap and share high-quality images using their favorite applications (Snapchat, Instagram, etc), and social media services (Facebook, Twitter, etc). InvenSense's optical image stabilization chips help users take better pictures, creating better experiences. And finally, InvenSense will continue to look for complementary acquisitions, such as its most recent one for Analog Device's MEMS microphone business. Voice technologies are becoming more important features on phones, and device makers are responding by putting more than one microphone in a phone.

When we add up the opportunity, $2-$3 of content across billions of sensors in billions of devices, InvenSense stands to gain quite a bit over the next five years.

3. Lots of growth options
So far, all of my focus has been on mobile devices. And why not? That is, by far, InvenSense's largest market opportunity today. But it's not the only one. We are still early in the Hype Cycle for wearable technologies, which can range from fitness and health equipment all the way to personal computers and immersive gaming. For example, InvenSense supplies a nine-axis solution (accelerometer plus gyroscope plus electronic compass) for Google Glass.

To foster the development of new uses cases for its sensors, InvenSense has created a reference kit and an application programming interface (API) for developers to use. The company says that more than 7,000 developers have come to its ecosystem. As they develop more and more uses for sensors, InvenSense is keeping its finger on the pulse of "the next" big development as its generates incremental revenue.

The Foolish bottom line
The market has not been happy with InvenSense since it reduced its fourth-quarter guidance. But that is creating opportunity for long-term investors, because the company is going to continue to grow and generate lots of cash flow. Currently, it serves the huge and growing mobile device market with great products that customers are buying. The company will continue to develop more content for that growing market. And at the same time, InvenSense will develop new markets, with the next big one being wearable technologies. With these three catalysts, InvenSense will be able to grow, grow, grow, making it a very attractive investment opportunity today.