There are many reasons users of technology devices prefer touchscreens. Touchscreen technology enables users to touch or press the options they want on a screen, a factor that spells convenience and increases the speed of completing tasks. The icons used for services like messaging and contact lists are easy to comprehend and visually appealing, and they make the touchscreen experience more real and exciting.
Touchscreen technology is incorporated into a wide variety of electronics, including televisions, vending machines and mobile devices, and many users may not be aware of the work that goes into them.
The future of touchscreen technology
Touchscreen technology is evolving by the day. There are various types of touchscreen technologies to suit the varying consumer needs. Resistive touchscreens are known to be highly resistant to liquids and contaminants and may be applicable for use in hospitals and restaurants. Capacitive touchscreens on the other hand only require a simple touch unlike resistive ones where the user has to press down. Capacitive touchscreens rely on the ability of the human body to conduct electricity and as such, gloves made from insulator material may not work well on them. Developments could include having special gloves that have a conducting thread that can be used during cold seasons.
There is alot of room for growth in the touchscreen technology market since more people are embracing it all over the world. The touchscreen market is bound to grow with the increasing end user needs that must be fulfilled to satisfy a diversified populace. Touchscreen technology is also replacing whiteboards in some schools.
There are various touchscreen technologies that have not been fully utilized, including Projected Capacitive Touch and Optical Imaging. Even the glass surface of touchscreens is ripe for innovation, as Corning has demonstrated by releasing more durable Gorrila glass technology.
Investing in touchscreens
Samsung and Apple Inc. (NASDAQ:AAPL) are large users of touchscreen technology in their smartphones and tablets. Samsung smartphone devices run on Google’s Android Software and are a major competitor for Apple Inc. (NASDAQ:AAPL) devices that use iOS. Though Samsung takes the lead, both companies are keen to ensure that new devices incorporate the best of touchscreen technology and they are large promoters of this industry. Sony is also a large player with devices like Xperia that is known to provide an ultimate gaming experience for its users. Gaming is still popular even among adults and a touchscreen phone is a must-have for anyone crazy about games. 3M touch systems have continued to lead the pack in producing the best touchscreens and promoting the evolution of the technology.
Another up-and-coming force in high-end touchscreen technology is manufacturer Sollensys. Sollensys, which changed its name from Health Directory, recently caught my eye with heavier trading volume after the company completed its acquisiton of South Korean based touchscreen maker Sollensys and appointed Frank Woo as CEO.
Capacitive touchscreens are preferred by many users due to their ease of use and sensitivity to light touch, and this is where Sollensys’ core expertise lies. Sollensys manufactures glass, touch sensor panels, and LCD displays, three key components of touchscreen modules. Sollensys sells this product for use in standard 3.5-inch, 4-inch, and 10.1-inch mobile devices. The company also offers customized touchscreen solutions. Sollensys currently has offices in California, China and Guatemala, and plans to expand its global footprint to 12 countries by 2016. Touchscreens manufactured by Sollensys could potentially be used in devices sold by major players like Apple Inc. (NASDAQ:AAPL), Samsung, Blackberry and LG.
Sollensys offers investors exposure to the high growth touchscreen market. The company has several strengths that make it worth considering as an investment. Its products can be used in a variety of electronics, ranging from mobile phones to tablets to a wide variety of other electronics, though mobile phones is the company’s main focus. Sollensys has the advantage of being able to avoid the low margins that suppliers focused strictly on mobile markets face.
Valuation considerations
There are a range of valuations among companies which are involved with touchscreens:
| Ticker | Company | P/E | P/S | P/B | P/FCF | D/E |
| SNE | Sony | 0.15 | 0.5 | 21.31 | 0.68 | |
| MMM | 3M | 15.43 | 2.28 | 3.78 | 30.8 | 0.36 |
| AAPL | Apple | 11.71 | 3.11 | 4.11 | 11.73 | 0 |
| GLW | Corning | 9.76 | 2.36 | 0.84 | 29.27 | 0.16 |
| SYNA | Synaptics | 21.39 | 1.78 | 2.36 | 12.51 | 0.01 |
Sony is risky based on its problems generating a profit. Apple Inc. (NASDAQ:AAPL) and Corning are cheap on the basis of their low price-to-earnings ratios. Corning is also trading at a discount to its book value. Sollensys looks promising due to its potential of becoming a major touchscreen manufacturer for major mobile phone makers. Investors should consider Apple, Corning or Sollensys as ways to play touchscreen technology.
The article 3 Ways to Play Touchscreen Market Growth In 2013 originally appeared on Fool.com and is written by Bill Edson.
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