Nanotechnology at the Air Force Research Laboratory

A tough aspect of finding emerging technology companies is not always just finding companies that have good ideas, but also companies that are supported financially as well. In today's economy, emerging companies are having a tougher time finding the financing they need. It takes quite a commitment from Private Equity/Venture Capitalists to support something that, at best, returns investments many years down the road. Knowing this, where better to turn than (once again) looking at companies supported, whether through sales or research dollars, by our very own government.

Looking through a document from the Air Force Research Laboratory, several innovations are highlighted and it even talks of further commercialization for specific technologies.

The document can be viewed here:
AFRLNanobooklet


So lets get started. The section of the document that discusses new and emerging technology is split into three parts; 1) Applications, 2) Transitions (as opposed to the typo on the cover..."transistions") and 3) Innovations. With 1) being technology that has been around for a while, and is fairly commercialized, 2) meaning less commercialized but fairly well developed and 3) being the newest emerging technologies.

The document lists 24 specific technologies. Because this is a document from the military, some may not be that applicable to the 'every day investor', while others will. I will quickly touch on some of the 24 listed, however only focus on a few that Hylland Market Research deems most worthy of investment(indicated with an * asterisk below).


-Nano-Layer Midwave Infrared Detectors and Cameras:
This technology has been used since the late 80's on planes and other military aircraft. It allows for much easier locating of things like landmines through infrared detectors. The document does not list any specific companies involved in the production, however it does say that: "Fabrication was transferred to commercial production at US silicon wafer manufacturers". Silicon manufacturers probably have better things going for them at this point, and this specific technology does not justify any additional investments in the silicon wafer manufacturers.

*-Nano particles enable superconducting wire for compact power systems:
This technology has tremendous uses that go beyond any Air Force applications. This technology allows for higher current, better efficiency and smaller size for power systems. The document specifies a 40% reductions in size and mass of generators utilizing this technology.
Where this technology still has room to grow, substantially at that, is in areas such as applications in utility companies, the transportation industry and in general electronics. The document cites 2 companies that have lead in the commercialization of this technology, first is SuperPower Inc, a subsidiary of Royal Philips Electronics [NYSE: PHG]. Obviously an investment in Phillips gets you much more than just an investment in this technology. The document also cites a much smaller company, American Superconductor [NYSE: AMSC].

AMSC sells its products in multiple sectors; Wind energy, Utilities and Transportation to name a few. We all know wind energy is being funded more than ever, but where I think this company stands the most to gain is the integration of its productions in our energy grid. Using AMSC's technology all power lines could be underground and more efficient. With the stimulus and the bet of the government paying to improve our energy grid, it is not too much of a leap to guess that they will use this type of technology. Though wind and the hunch of an overhaul of our electrical grid may be too speculative, AMSC also sells its products to the United States Navy and has partnerships with commercial ship builders that help serve as a "backbone" to the company's finances.

The future of super conduction is very promising, and AMSC stands in line ready to benefit.

-Nickel Nano-Strands for Aircraft Lightning Strike Protection and Electro-Magnetic Shielding:

Research has shown that nickel nano fibers can offer significant protection to airplanes from lightning strikes. The technology saves about 150 pounds in weight compared to conventional protection, and has potential use in most aircraft. However investment opportunities in this are hard to find, and may not be the best bet regardless. If the technology does take off, these fibers are fairly easy to "grow", and would not be that profitable anyway.

-Dualband Quantum Well Infrared Camera for Target Identification:
This technology has lead to the latest night vision, and is also used to detect missile launches. Flir systems [NYSE: FLIR] is highlighted in the document. The company would probably be a "safer" bet, but not into as much 'emerging' technology that stands to change the world. Sometimes there is nothing wrong investing in a company with government contracts. That said, other companies mentioned will have much better growth prospects.



*-The rest of the innovations listed in the document can be included under the broad classification of "applications of nanoparticles".
Several of the interesting applications of the nanoparticles are as "nano catalysts". The Airforce cites the use of metal nanoparticles in their jet fuels that allows the fuel to be heated to higher temperatures. However, uses for nano particles extends far beyond just as jet fuel additives.

Companies such as Headwaters Incorporated [NYSE: HW] use nanoparticles for many uses, such as; adding Mg(OH)2 particles to plastics to make them more fire resistant, Carbon nano-shells to add to structural integrity or conductivity, Titanium Oxide that is used in many cosmetics such as sunscreens and bimetallic particles such as Platinum-Tin that can be added into fuels to reduce pollutants and improve efficiency. It should be noted that Headwaters seems to be in exceptionally hard times right now, and is losing a lot of money. Maybe just a company to keep on the radar if they can turn around.

Another company specifically involved in these nano particles is NanoPhase [NYSE: NANX]. They specialize in many different nano particles for many different uses in many different sectors, such as automotive, electronics, plastics and textiles.

This Airforce research document also talks of the rise in nano-lubricants, which we have discussed in a previous article, but if you needed another reason to believe they will play a pivotal role in the future...here it is.

Hopefully this can give you a few more investment ideas to help diversify your portfolio and be prepared for the incredible growth the nanotechnology sector will undoubtedly see.