I’m worried about the real estate market, but I’m not too worried. Interest rates are rising, but so they should — demand for money is rising commensurately. Everywhere I look, there is new building going on, whether it’s new condominiums or suburban development. Urban sprawl is everywhere.
I recently came across an interesting company that is cashing in on the growth in industrial real estate, as well as the renovation industry.
This small-cap company is called Color Kinetics Inc. (NASDAQ/CLRK), and it designs and sells specialty solid-state lighting systems all over the world. The company makes highly efficient, environmentally friendly lighting that is used in restaurants, television studios, cruise ships, game shows, and art galleries. You name it, this company has a lighting solution to fit your needs. The company was founded in 1997 and is headquartered in Boston.
In the third quarter of 2005, the company generated record revenues of $14.1 million, up 27% over revenues of $11.1 million generated in the third quarter of 2004.
Net income grew an impressive 47% to $1.3 million, up from net income of $853,000 reported in the third quarter of 2004.
One area where the company is now focusing its business development is in the television and production industries. The company recently installed its lighting solutions for “The Tonight Show,” CNN’s Washington D.C. newsroom, “The Situation Room,” MTV’s “Total Request Live,” and “The X Factor,” a top entertainment program in the U.K. The company will also provide the lighting for the “Final Draw” ceremony for the 2006 FIFA World Cup.
I find that some of the best wealth creating companies are those that take an existing product (or service), use technology to innovate it, and employ a great sales force to sell it. It looks to me that Color Kinetics Inc. is one of these companies. At the very least, the company makes nice looking light fixtures.