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InterDigital, Inc. Message Board

  • investora2z investora2z Jul 28, 2013 7:09 AM Flag

    Trying to recover

    Good earnings has given it a push, and Interdigital is now trying to recover from the crash after the court ruling. It will be interesting to see how far the recent momentum continues. The drop after the court ruling was with a lot of force, and the volumes were also tremendous. The recent rise has not been accompanied by similar amount of interest. The volumes have been relatively low. The company beat the analyst estimates by a huge margin. It reported $0.22 earnings per share for the quarter compared to the consensus estimate of $0.15. However, the revenue and the net income were down on a yoy basis. Sequentially, there was remarkable improvement in the top and the bottomline. Barclays Capital has a PT of $43.00, the consensus rating is Hold and the average price target is around $49. Litigation is being pursued by many companies to monetize their patent values. There have been recent successes like Blue Calypso (BCYP) with a licensing settlement, but there have also been failures. Interdigital has revenue generating licensing arrangements and hence is not solely dependent on the outcome of lawsuits. Still, the diversification is not as much as one would like to see. The liquidity and leverage position is very good. The debt on books on June 30 was $204 million whereas the cash was around $770 million. The ttm valuations are currently influenced by the abnormally high EPS in Q3'12. The future will depend on its performance in the next few quarters. For the short term, it has to cross important hurdles ($44-$45) with conviction, and spend time above that. If it is able to do that, then the short term outlook will improve. In any case, the stock is still more than 50% up on a 52 week basis, so it has not done that bad for investors.

69.55-11.00(-13.66%)Oct 27 4:00 PMEDT