Rambus (RMBS) Falls After Trial Delayed, Analyst Says No Big Deal Sep 1, 2009 08:31AM
Rambus Inc. (Nasdaq: RMBS) is down 10% this AM after at a hearing yesterday the judge in the Samsung trial moved the trial date due to the "grave condition" of Samsung attorney.
Analysts at Capstone Investments commented, saying, "Judge Kramer felt that beginning trial in '10 was likely the best choice as he didn't believe he could provide Samsung proper time to bring new attorney(s) up to speed, while also avoiding any rollover into holiday season. Given timing of prior Sept. 28th date, any delay in starting trial would likely pose issues in jury selection as holiday period would likely interfere."
On this, Capstone said other than timing they see little impact from yesterday's ruling. They believe RMBS's case remains intact, and see no change in legal position. The firm is reiterating their Strong Buy rating and $60 price target on RMBS.
Capstone thinks that while RMBS's Anti-Trust trial has been the primary focus of investors, its proceedings vs. NVDA in ITC could offer potential near-term catalyst. Commenting, "based on recent ITC Markman ruling, which we view as a significant win for RMBS, we believe NVDA will likely need to settle with RMBS or risk potential injunction, and injunction of its customers (HPQ, MicroStar, Asustek and others). Hearing before Judge Essex is currently scheduled around Oct. 12th. In our opinion, any settlement would likely occur prior to hearing. While not equal in dollar size to upcoming Anti-Trust proceedings, we believe NVDA settlement could equal ~$1B+"