GTAT sits right around $15 per share after hitting a high of $20.54 earlier in the year. This is a 25% drop and what looks like a good entry point for a stock that has lots of things going for it that can play out nicely in the long run.
Right Now It Is All About Sapphire
GT’s main claim to fame is sapphire and the reported 2500+ furnaces they now have going which are to supply screens to Apple for the iPhone 6 and iWatch. Note: until those products are actually released, everything is just a rumor. But the evidence that has come to light this year is so strong that I believe we can now assume that sapphire will be part of at least one of those Apple products and quite possibly both of them.
Sapphire is scratch resistant, very strong, and very clear which is why Apple has decided to use this new material in its products even though it is more expensive than Corning’s Gorilla Glass. If sapphire is everything it is reported to be, it will give consumers another strong reason to buy the iPhone 6 and abandon phones on the Android system. GT Advanced Technologies might be sitting in the sweet spot if those Android manufacturers decide that they also need sapphire to keep up with Apple.
But There Are Other Catalysts
Sapphire isn’t the only thing GTAT has going for it. It has a solar division of the company that produces:
1) a furnace named HiCZ is new that may be able to extend the efficiency of solar panels
2) Merlin is their newest technology that, through metallization, is able to lessen the amount of silver that is needed in solar panels by as much as 80%
3) GTAT also makes the Hyperion Ion implanter that makes solar panel substrates and these machines are believed to be increasing in demand yearly.
GTAT Is A Growth Stock Pick
If you like growth potential, GT Advanced Technologies has it and that is why I am calling it my Big Bet Pick for this month. There are risks as always, chiefly that sapphire doesn’t pan out to be the material everyone thinks it is or that Apple ends up not using it in the quantities rumored. For that reason and the speculative growth nature of this pick, a smaller part of your portfolio should be the most you allocate toward this stock.
But if Apple does adopt sapphire as their screen material for all iPhones and iWatches, chances are that this alone will propel the stock nicely. Then, if any of the other catalysts end up proving to be profitable and in demand in the next 5 years, GTAT should do very well as a growth stock.
*As always, this blog is just my opinion and you should consult your professional financial planner or stock broker before buying any stock recommended here.