Within 10 years, some roboticists say, personal utility robots will have the ability to do everything from cleaning your toilets and washing dishes to keeping your schedule and monitoring your vital signs. That may actually be a pessimistic projection. On the higher-tech side, they will automate advanced microchip and biotech production lines. They will also perform sophisticated surgeries that are impossible today.

If this seems far-fetched, I would caution you to think twice. Think back 10 years. Did you think then that we would be using the advanced Web-connected cell phone/PDA/media player devices that are common today? If you are a physician, as are many of my readers, did you foresee the current state of medical robotics?

Additionally, the medical industry has a particular advantage during a recession. Health care is one of the sectors most protected from business cycles and economic slowdowns. We cut back or eliminate lots of things when budgets get tight. Non-elective surgery isn’t one of them.

Moreover, the medical robotics industry is far from unproven. For an example of the kind of profits that exist in this barely tapped field, let’s take a look at Intuitive Surgical.

In January 2003, you could have picked up Intuitive Surgical for $6.02 per share. As I write, Intuitive is trading around $200. Prior to the current fluctuations, it was trading around $300. Its revenues and growth prospects justify that price. Even if it never recovers, which is an absurd assumption, Intuitive will have increased in value 3,000% percent in five years. I consider that a decent profit and a good start at true transformational status.

Though Intuitive has lots of room to grow, I’m not recommending it. It’s a bargain during this downturn, but I try to keep our stocks around or under the $10-dollar mark, to give my readers more buying options.

Anyway, its market cap is relatively big, so we’d be pretty diluted buying today. My goal is to get readers into transformative stocks before the average investor figures out what’s going on.

So I’m going to recommend another medical robotics stock. Today, there are two relatively well-known candidates in the field. Both are still in the small-cap stage, and both have gone after the heart surgery market. Both have made their own mistakes, and both are in the process of overcoming FDA rulings. Both are currently losing money, as did Intuitive in its early days, but they’re both also gaining in sales. Both get revenues from the sales of disposables needed for each new surgery, as well their surgical systems.

In my current issue of Breakthrough Technology Alert, I analyze the two companies and select the stock that’s best equipped to survive and thrive in the short and long runs.

Yours for transformational profits,
Patrick Cox

November 5, 2008

This Small Robotics Company Could Be the Next Microsoft was originally featured in the Penny Sleuth.

The technique itself was developed by BeSang, based in Beaverton, Ore., with the assistance of Stanford University’s nanofabrication researchers. For the first time, BeSang claimed, chips could grow upward, not just outward, without significantly raising costs.

At the time, I doubted implementation would come anytime soon. Apparently, I was wrong. BeSang and Stanford have just announced that their 3-D IC manufacturing process is available for licensing now.

Needless to say, I’ll be watching BeSang and its 25 patents in case it goes public.

My point, however, is that Moore’s Law is going to hold. The number of transistors that can be inexpensively placed on an integrated circuit will continue to double approximately every two years. New technologies and products will continue to emerge.

Moreover, they will yield the kind of profits that come only from breakthrough, transformative industries. Robotics is one of them. Count on it.

Let me give you just one more chip breakthrough set to maintain this breakneck pace. This one could actually be more significant, because it isn’t about transistor density. It is about the way that chips work.

Memristors Coming Soon

Since 1971, computer scientists have theorized about memristors. This hypothetical component would maintain information without electrical currents, but function as dynamic RAM memory.

This is a huge deal. Computers with memristors would be faster and require less power. Booting would be nearly instantaneous. On/off buttons could become irrelevant, except to avoid accidental activation. Battery life for mobile devices, including robots, would be extended significantly.

HP proved that it could, in theory, make these once mythological “fourth components” using new nanotech tools. When I reported its claims, though, I speculated in vague terms about future production. Honestly, I was thinking four or five years out. According to the reliable EETimes, HP Labs will produce prototypes next year. Commercialization is expected to follow quickly.

In the space of months, the IC road map has changed profoundly. Once again, chip designers are going “back to drawing board” to rethink the future of microprocessors. Specific to this issue, memristors, combined with increased chip density and more efficient batteries, are exactly what it will take to move robotics to the next level.

The Incredible Promise of Robotics

Today, there are about one million industrial robots in service. That number is increasing over 10% annually. The international automotive industry depends entirely on robots, as do several other manufacturing fields.

Chip manufacturing, biotech and pharmaceutical companies rely on robotics to perform precise and repetitive functions in environments intolerable to humans. Also relevant to a subject covered in this issue, robotics will be central to the commercialization of stem cell therapies.

Another area of rapid robotic growth is security and defense. Some of the earliest recognizable robots were remote-controlled bomb detonation units. Today, unmanned military vehicles can pilot themselves in hazardous situations. Some are simple devices used for bomb inspections and detonation. Some are sophisticated mobile weapons systems. Many are utility vehicles ranging from self-driving trucks to relatively small “PackBots” that climb stairs, risk tripwires, find land mines and look around corners. Some are armed and can be fired remotely or return fire automatically. Though the public may not think of them as robots, automated missile systems have been around for decades.

I recently found a company that is really set to take advantage of this surge of chip technology and robots. Unfortunately, it’s far too small to include in such a large publication like Penny Sleuth. That’s why I saved it for my Breakthrough Technology Alert subscribers.

For transformational profits,
Patrick Cox
September 16, 2008

Investing in the Chip Revolution was originally featured in the Penny Sleuth.