Update on Superconductor Technologies and its place in our portfolio

4th December 2019 | Eoin Treacy

I thought I would write to you today about what’s going on with Superconductor Technologies.

Understandably I have received feedback about this company and I wanted to respond with my case for sticking with it.

In the third quarter earnings call, the CEO Jeff Quiram mentioned the company is in discussions with strategic partners about an investment to bring the Conductus wire to commercial production or to buy out the company.

There is no further news on whether these talks have been successful or not. The company has been working with MIT and the US Department of Energy on delivering wire for high performance magnets but only has enough money to run through until the first quarter of 2020.

Therefore there is some urgency in getting a decision on a strategic investment or buyout. 

The frustrating point is the company has the technology to greatly enhance the efficiency of new fusion reactor designs which depend on extremely powerful magnets to contain the plasma. The challenge is getting to a point where it can produce the wire at scale and turn a profit.

The risk is the company will run out of money before it is taken over or rescued. I don’t think the partners Superconductor Technologies is working with are going to be willing to allow the intellectual property the company has built up slip out of their control in a competitive bidding process that would take place during a liquidation.

That suggests an investment is probably forthcoming.

I want to see how this plays out and for that reason I am moving this stock to a HOLD in the portfolio.  

Many thanks,


Eoin Treacy
Investment Director, Frontier Tech Investor

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