Sierra Wireless (NASDAQ:SWIR) is known for providing wireless solutions for machine-to-machine, or M2M, applications. As written by Fool contributor Chris Neiger in April, this has placed the company in a position to benefit from the Internet of Things. This seems like a big deal because the Internet of Things is a $19 trillion opportunity, according to Cisco (NASDAQ:CSCO). IDC also forecasts that the Internet of Things will give rise to demand for $8.9 trillion worth of connectivity equipment and related solutions by 2020. 

Sierra Wireless has a big addressable market ahead that it could tap to significantly grow its business.

A strong business
The company is seeing strong sales of its 2G, 3G, and 4G-enabled wireless modules for mobile computing, energy, industrial, networking, and automotive applications. It has also recorded various new designs wins. The company's recent first-quarter results were also strong. 

Sierra Wireless posted record revenue of $121.2 million in the first quarter, an increase of 19.5% from the year-ago quarter. It also posted a non-GAAP net profit of $0.5 million, or $0.02 per share. In comparison, Sierra had reported a net loss of $0.7 million, or $0.02 per share, in the first quarter of 2013. Moreover, Sierra's outlook was strong. The company expects revenue in the range of $128 million to $131 million in the second quarter, well above the consensus estimate of $123.8 million.

Key acquisitions
Sierra Wireless has improved its position by acquiring In Motion Technology and AnyData's M2M business. Both of these acquisitions were made with an eye on the market that the Internet of Things will open up. 

AnyData brings a suite of M2M embedded modules and modems to Sierra's portfolio. Sierra already leads the cellular M2M embedded module market in terms of market share, according to ABI Research, and this acquisition will enhance its position. Besides, AnyData has a huge network and an established sales channel in Korea.

On the other hand, In Motion provides mobile enterprise solutions and rugged in-vehicle mobile routers that are integrated with an advanced mobile-optimized security system. This will help Sierra benefit from connected vehicles going forward and strengthen its position in the transit and commercial fleet markets. 

Product development moves
The company is investing heavily in Legato, its next-generation Linux-based platform that is intended to help developers create applications faster. Sierra will preinstall Legato on all new smart device modules. This move should drive the adoption of its products since Sierra believes that the Linux-based platform will be efficient and productive for developers in the long run.

Sierra is also boosting its product portfolio by launching a couple of new gateway products -- the AirLink LS300 and GX440. These are based on the Legato platform. Sierra also announced ES440, a gateway product designed specifically for branch office business continuity applications. The company is currently working on the commercial rollout of the product by shipping it to Europe.

The Internet of Things is gaining momentum
Sierra's product moves look interesting. The company is progressing in the right direction with these moves as the Internet of Things is gaining momentum. For example, Cisco recently injected $150 million into Internet of Things start-ups and accelerators through its venture capital arm, Cisco Investments. This investment arm of Cisco has a $2 billion portfolio to promote innovative and disruptive products. 

The networking company is working to bring more devices online, which will lead to higher demand for machine-to-machine connectivity solutions that Sierra provides.

The bottom line
Looking at the huge growth potential, Sierra Wireless looks cheap at a trailing P/E of 10.5. The company's net profit margin also looks decent at 13% and Sierra has no debt on its balance sheet, while its total cash stands at $151 million. Since Sierra's shares are down 17% this year, it would be a good idea for investors to use this drop to add this potential outperformer to their portfolio.