Analysis Aware Inc.

AWARE INC.

Aware Inc (AWRE) is a leading provider of software and services to the biometrics industry. The software products are used in government and commercial biometrics system, which are capable of determining or verifying an individual´s identity. The principal applications of biometrics sytems include border control, law enforcement, national defense, secure credentialing, access control and background checks.

The biometrics industry may be segmented into government and commercial sub-markets, with Aware generating 80% of its revenue from governmental customers. 

Right now the biometric industry could become very important. With new ways to pay like Apple Pay coming to the market the convenience and security of the biometric market will be needed. This movement is also seen in Aware Inc. They are ramping up their R&D sector to profit from this growth.

This small cap stock looks like it could become a really big player soon. Some funds of Investment gurus are already invested, like Renaissance Technologies by Jim Simons. (to the source )

Earlier this year Aware paid a $1.75 special dividend because of the concerning risk of making acquisitions, which indicates a good operating by the management, who know that an unwise purchase could have reduced shareholder returns.

Due to high competition in this sector this stock is not a safe bet, but has a lot of potential with little downside risk because AWRE has approximately 50% of the company´s stock price in cash and investments, without calculating in the pattents. A normal price target for next year could be around $8.

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