In 15 months I think that the share price will either be a lot lower or a lot higher than it is now. IMO it will be a lot higher. I think that the risk/reward ratio vs. the share price for Weebit is significantly undervalued (I am thinking long term). Of course, this is a spec stock and there are risks involved, DYOR etc. I also recognize that there is the possibility that the price might drop 10-20% between now and the end of the year because of the options, released shares from escrow and the ASX in general being news hungry. However, at least one collaboration agreement is expected this year. Once an agreement is made or some other significant news occurs IMO the price should go much higher.
@mbc you have pointed out some risks in previous posts. My summary of what I have understood to be the risks and my responses to them are below.
Risk of R&D failure
I see this risk as small due to WBT reaching the 40nm Mb array milestone and the initial testing being positive
WBT has made rapid progress and have consistently met each milestone on their development roadmap in the last two years. They have also been honest and transparent. I think that this provides a decent amount of confidence that the company will be able to reach their other milestones. There are always risks when developing new technologies, but given the experience and expertise in the management team I think that WBT is well equipped to be aware of them and to deal with them.
This risk doesn't seem to be directed at Weebit, but at the ReRAM market in general. I see this risk as small because ReRAM has benefits over flash and it seems to me to be generally agreed that there is a scaling limit for flash and that this limit will drive the adoption of some new memory technology, e.g. ReRAM or something else. ReRAM, in general, is seen as the main contender out of the emerging technologies. Risk that some other technology will be developed that will be better than ReRAM as ReRAM is better than flash, i.e. a next generation after ReRAM.
Once again this is not directed specifically at Weebit, but at the ReRAM market in general. It will eventually happen, generally it happens every 10 to 15 years. Therefore, this is a risk, but it is likely going to be something that we would see coming. It has taken years for Weebit to get to where it is and Weebit has been progressing rapidly. Also, generally the next generation memories are in development/research stages for a while before they start to make an impact and I am not aware of any reasonable evidence that we should be fearing that ReRAM will become redundant before it even starts becoming a large portion of the memory market.
Risk of not being competitive vs. other ReRAM technologies who are making progress, e.g. crossbar and 4DS
I don't see the ReRAM market being a winner takes all kind of scenario. Although, there will probably still be a couple of key players like there is for flash now. The way I see it, the success of crossbar or 4DS doesn't mean that Weebit's fundamental value should necessarily go down. It could even be seen as a good thing for Weebit as it proves that ReRAM works and generates interest in the ReRAM market. Also, Weebit only has to take a very small portion of the total ReRAM market for it to be successful and given the benefits of Weebit's ReRAM compared to the others I see the risk as being quite small that they will get to the production stage and then not be able take at least some small portion of the market.
Compared to the other types of ReRAM I believe that one of the main advantages Weebit has is that it should very likely have the lowest cost per bit. This is because of the Silicon oxide aspect of the ReRAM and is one of the main reasons why the Silicon Oxide aspect matters. When it comes to the adoption of the new memory technologies “cost is the one overriding factor that will determine their success”. Crossbar's memory element is made from silver one of the most expensive metals in the semiconductor industry. 4DS's memory element name is MOHJO (Metal Oxide Hetero Junction) which uses different oxidized metals Praseodymium (PR), Calcium (Ca) and Manganese (Mn).
4DS is also targeting the SCM market while Weebit is targeting the embedded market, so Weebit and 4DS will only come into competition later on. From a Tmt interview Coby said:
In terms of the timeline for the actual commercial production of the underlying technology of 4DS and Weebit, I see it as fairly close (2-3 years). Longer for Weebit as they will scale down further to 28nm. I would guess that it is still 2-3 years (please correct me here if anyone knows a more accurate timeline) till the 4DS technology is being commercially produced, not considering niche areas. This is because after 4DS proves that the production of Mb memory devices on 300mm wafers works in IMEC's production fab there is still further optimisation, scaling (MB to GB etc.) and tuning (modification of the memory to prioritise certain aspects, e.g. speed, retention, endurance etc.) that still need to be done. Each production fab is different also, so there is probably some extra tweaking work required there as well. None of this work is likely to matter for 4DS as they are looking to be acquired, not to produce the chips, but I think that it does mean that it will be a few years before the chips are being produced and sold in a major way. In the semiconductor industry everything is measured in years.
Note also that Weebit is further along than 4DS in some areas, e.g. they reached the 40nm Mb array milestone on 25/06/2018. My understanding is that 4DS has only reached the 40nm cell level. A cell consists of only 1 bit & is a proof of concept of production capabilities.
It is a bit hard to compare the different companies at this stage. Hopefully mid next year once Weebit has finished the "baseline improvement to achieve robust technology parameters" we will have enough data to make accurate comparisons including speed etc. between Crossbar/4DS/Weebit/Others.
This is a comparison from Weebit's May presentation
WBT Price at posting:
4.4¢ Sentiment: Buy Disclosure: Held
(20min delay)
