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Acacia Research Corporation Message Board

  • investora2z investora2z Apr 18, 2013 9:56 AM Flag

    Earnings will be the key for short term trend

    Acacia announced recently that its Brandywine Communications Technologies LLC subsidiary has entered into settlement and licensing agreements with Microserv, Inc. & World Computing Inc. to resolve the pending litigations in the US District Court in Idaho & Illinois respectively. The stock is up nearly 50% since November last year when it made its 52 week low of $19.86. It is trading above the 200 DMA of $26, and is holding up above the 50 DMA of around $29. The volumes have been tepid with 3 month average being 557K, much above the 10 day average of 444K. $30 has to be taken out with volumes for the next leg of the uptrend to start. Otherwise the narrow range is likely to continue. On the downside, if the 50 DMA is broken with volumes, then the 200 DMA will be the next support. Let us see how it reacts to news flow and the upcoming results. Recently, patent infringement lawsuits have been on the rise, and there have been cases where the small companies have been approached for settlement by the defendants. In a recent report by JP Moreno on Document Security System (NYSE:DSS), the potential and risks of these lawsuits have been highlighted. Moreno has highlighted the positive points in the business models like that of DSS which is having a huge operating business of document security software solutions etc. (turnover of $17 million in 2012), and is not a pure patent play. DSS acquired Lexington Technology Group (LTG) recently (merger under finalization), which is likely to benefit from a high value infringement lawsuit filed against the likes of Facebook (FB), LinkedIn (LNKD) etc. The near term trend for Acacia will be obviously dependent on earnings. So far the financials have been strong, and there are expectations of continued growth in revenues and net income.

 
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