InterDigital's Shares Got Crushed: What You Need to Know

• Report this Comment On September 26, 2011, at 4:06 PM, pfflyerkid wrote:

  MPartners Report (9/26/11) - "Deal Reporter Rumor - Company Says Process Continues" (full report)

  MPartner's Intra-Day Note (9/26/11) "Deal Reporter Rumor - Company Says Process Continues" is now at WirelessLedger.com.

  Download/View Report

  STOCK TRADING BELOW $50.00 AFTER INTERPRTATION OF DEAL REPORTER ARTICLE GOES VIRAL ON TWITTER

  * Essence of the deal reporter report:

  - Receiving bids of between $1B and $2B

  - Not much interest in the patents

  - Maybe HTC

  - Sources cited include “people familiar with the situation” including 3rd party lawyers.

  COMPANY SAYS NOTHING HAS CHANGED

  * Would not have undertaken the process if they thought that the potential value of the patents was not worth substantially more than the fundamental value of the stock.

  * Process continues as announced on July 19th 2011.

  * Would not sell patents if they were worth less than the fundamental value of the company – they have “lots of money”.

  DEAL REPORTER HAS DISTRIBUTED SPECULATION ON THE STOCK PREVIOUSLY

  * Previously, InterDigital has denied speculation from sources such as Deal Reporter.

  IF NOTHING HAS CHANGED – NEGATIVE SPECULATION IS A BUYING OPPORTUNITY

  * Bottom line is that the company continues to execute on the process announced in July.

  * Company has not commented on the specifics of the process since it began – so the “sources close to the situation” may not have effective information, or they may have unaligned motivations.

  * Based on our sum-of-the-parts analysis. the fundamental value of the stock is $65.50 without the benefits of cash flow from Nokia, ZTE or Hauwei.

  * We believe that there is demand tension for the patents and that the overall value should fall in a range of between $110 and $130 per share. We reiterate our $118 target price and BUY recommendation.

• Report this Comment On September 26, 2011, at 4:14 PM, bustedbox2 wrote:

  Anders, you can do a littlle better than this, can't you -- uncritically reporting a report planted for the express purpose of tanking the share price? Do you think a serious bidder would bid $1B for a company with a world class patent portfolio and $700M in cash?

  Come on, DealReporter is already at the disposal of the shorts. Do you think they also need The Motley Fool to help them out?

• Report this Comment On September 26, 2011, at 4:20 PM, jmbring wrote:

  Anders,

  your conclusion about the temperature of the patent market is hasty. first, we're talking about rumor of initial offer. if the rumor actually has any substance, it makes sense the initial bid is lower (and possibly much lower) than the final deal.

  second, IDCC has like 700M in cash alone.

  1-2B sellout price doesn't pass the sanity test.

• Report this Comment On September 26, 2011, at 4:23 PM, huibs wrote:

  ..a nonsense article..

  ..these were 'initial bids' in the 1-2 billion dollar range..

  ..the stalking horse bid for the Nortel patents was 900 million....could you imagine, if Nortel were trading, what would have happened to the share price had you heard that the initial bid was 900million?..

  ..those patents sold for 4.5 Billion, 5 times the initial bid..

  ..the initial bids for IDCC are in the 1-2Billion dollar range..

  ..I'll let you do the math..

• Report this Comment On September 26, 2011, at 5:39 PM, drbldr wrote:

  It is important for everyone to understand that the company has not said anything. We've heard good rumors, bad rumors, rumors about this being an auction, rumors that bids were due this week, etc. The bottom line is that none of it has been confirmed. The only thing that will matter is a report that has been confirmed by the company. That said, IDCC is proving to be extremely volatile, so either accept the movements on the rumors, or watch from the sidelines. Today's rumor will likely not be the last.

Add your comment.