When we spoke on Tuesday, I introduced you to the massive potential for investing in a new immersive field known as the metaverse. The thing is, I haven’t even covered the extent of the opportunity this new field will offer us.

I want to re-emphasize how big a deal it is that the top 12 firms that offer access to the all-encompassing technology alone now sport combined market caps of roughly $11.5 trillion dollars.

Now, Mark Zuckerberg is making a lot of noise about the billions that Facebook Inc., or as it’s now called, Meta Platforms Inc. (FB), is investing in this field to get an early mover advantage.

But that’s just a distraction. Last time, I noted that, at this point, Apple Inc. (AAPL) is a much better investment with more upside because its app store offers investors a premium metaverse portal.

But there’s another stock in this field that I want to tell you about as well.

To really understand the potential of this latest play, you’ll need to take a look using a very special “lens” – and I mean that literally, the lens of an advanced AR headset.

The firm with this unique metaverse “vision” is on pace to double earnings, with strong odds of doubling its stock price, in roughly 2.5 years…

Seeing Double
I’ve mentioned in the past that the metaverse is the convergence of virtual reality (VR), augmented reality (AR), and the physical world. It’s the idea that we can use AR and VR technology to enhance the real world, and blend the physical with the digital to make things safer, more fun, and more informative.

For example, imagine if delivery drivers could see the destination address of each package overlaid on top of it just by looking, rather than having to scan the barcode on each package.

Or imagine being able to see digital avatars of your co-workers in virtual meetings, letting you read their body language for better communication.

These are just some of the places in which bringing the virtual closer to the physical – creating the metaverse – would be helpful.

The way you get there, of course, is having a way to see the virtual and the physical at the same time. That’s exactly what AR glasses and headsets do. They let you see through them, but overlay a digital image on top of what you see.

And you can’t talk about AR without mentioning Microsoft Corp.’s (MSFT) HoloLens headset.

Augmented Performance
Now in its second generation, the HoloLens is still the best AR headset around and has by far the most applications and uses, thanks to Microsoft’s push into the metaverse.

Defense giant Lockheed Martin Corp. (LMT), for example, uses Microsoft’s HoloLens 2 AR headsets to help bring new factory workers up to speed.

The headset shows 3D images with instructions for how to assemble machinery, with each image anchored to the relevant part, so that when the worker moves their head or walks around, the images remain displayed in the correct places.

This has increased Lockheed Martin’s manufacturing efficiency by a whopping 90%.

For luxury carmaker Mercedes-Benz, the HoloLens 2 has cut down travel by 40% as expert engineers can now assist factory workers around the world remotely. Both parties simply don the HoloLens 2 and can then see each other as if they were in the same room.

One works on the actual piece of machinery, while the other can see a digital replica of that same machine and show exactly what needs to be done.

Metaverse Foundation
Of course, all this melding of the virtual and physical worlds requires a lot of computing power. Most businesses don’t have that, or the expertise to set it up.

That’s precisely where Microsoft’s Azure cloud computing business comes in. It can easily handle all or most of the data storage and calculation necessary for the metaverse – and can share it across the world, something even the largest companies can struggle with.

The thing is, none of these are new platforms for Microsoft. Instead, the company is building on its existing projects and properties, which gives it a big head start and will create great metaverse margins after just a little tweaking.

After all, Microsoft’s Xbox gaming division already deals heavily in mixed reality. Gaming consoles are nothing but extremely capable platforms that enable several people from all around the world to interact with each other in simulations of real-world environments.

The Xbox Kinect gaming platform, which originally captured the motion and posture of gamers to map that onto their gaming characters, eventually became the basis for the HoloLens technology.

Bases Covered
Put it all together and you can see why Microsoft is a strong play on the metaverse, and why I’ve made it my number three pick to profit from this trend.

The company checks most of the boxes when it comes to the metaverse. With the HoloLens and the Xbox, it makes the hardware that will make the metaverse real.

With Azure, it runs the cloud that will allow people from all around the world to share their virtual experiences at low cost and high speed.

And it’s already working with industry in integrating the virtual with the physical.

In short, Microsoft is a metaverse triple threat: AR headsets, gaming consoles, and the cloud.

And there’s plenty of upside ahead. Microsoft is growing earnings at 27% a year, meaning they’ll double in just over 2.5 years. The price of the stock has a strong chance of following.

Cheers and good investing,

Michael A. Robinson

Source: Strategic Tech Investor