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Frank .. I would have taken a thousand words to say what you have in 150. The true measure of due diligence is quality, not quantity. The key to quality is the judgment necessary to separate the wheat from the chaff. I know you to be one who looks at ALL of the wheat and ALL of the chaff which makes your judgment particularly valuable to this board.
Well done, well done indeed.
MO,
Danny
Rakitno .. Let me save you some frustration and angst. This board no longer has anything to do with IDCC due diligence. It has become a place for Olddog, Rmarchma, Nicmar, Datarox, Dmiller and several others to achieve a level of status they heretofore have never experienced .. they've become message board legends in their own mind if you will. And they spend their days 24/7 burning daylight proliferating their legends. Laughable or pathetic .. take your pick.
Not a one of them can hold a candle to Loop, The Count, Revlis, Mschere (God rest his soul) and many others who post here more infrequently everyday, let alone the bulldzr types on this board who get attacked for being whistleblowers. My advice .. post what you think and let the IHUB untouchables deal with it as best they can. Don't respond to their clearly self-serving attempts to discredit your ego-busting comments.
MO,
Danny
Net .. Unfortunately, that is the kind of distortion that can result from having so few covering analysts.
MO,
Danny
Habu .. All one has to do is look around to know that it ain't the market you grew up with.
The thieves I grew up with were penny ante compared to today. As a result even though innocents got screwed most of the time it was minimal and, far more importantly, the effects were not long lasting. Today we have financial terrorists on WS .. Masters of the Universe on steroids .. who have struck a blow that has left everyone grasping at straws just looking for some light at the end of the tunnel, let alone finding a way out.
I don't disagree with your assessment of WS and the preponderance of thieves that now exist there. However, analysts are just bit players .. and most lost their jobs through no fault of their own .. in this disgusting debacle. The analysts that cover IDCC are even tinier fish in a VERY big pond. The paucity of analysts covering IDCC, a criticism I have long had of IDCC IR, have allowed the three analysts to get far more recognition than they deserve as well as exacerbated the impact mistakes that they make. It is what it is, unfortunately.
MO,
Danny
m3s .. Sure .. and I would say the same to you about MOST of the message board postings since they, to, are opinion based.
I'm going to try again to provide some clarity on this issue. Every single one of us can beware of analysts and their work product 24/7 and we will have NO effect whatsoever on whether their clients value their work or not. We don't get a vote.
Don't assume that institutions just blindly accept the work of every analyst. Far from it. They put them under greater scrutiny than is done here .. if that is possible LOL. AND they keep score. Three strikes your out and out of the game kind of keeping score.
Don't shoot the messenger.
MO,
Danny
habu .. Sounds like he is not a very good analyst and his career is likely to be short-lived and insignificant.
Incompetence does not a manipulative agenda make.
I've truly lost track now, but my recall is that TC was REALLY raked over the coals for his APPL estimates. Doesn't it look so far that he, the rakee, is closer to being right than than the rakers on both boards?
Being right does not a manipulative agenda make either.
MO,
Danny
Ratkitno .. What a breath of fresh air you are! I agree with everything you say about analysts reports and TC in particular.
That being said, it truly is, in my opinion, bad form for Tom Carpenter to have issued a downgrade to a stock which he only upgraded 15 days ago with no negative events to justify it.
At the risk that I will be again accused of "having TC's back", the now you see it, now you don't aspect of this downgrade with NO underlying report, led me to conclude that he had negatives that he only wanted to disclose to his clients in private. Of course, since analyst work product is not subject to FD guidelines, he can be as selective and circumspect in non-public conversations as he wants to be. If he didn't have some negatives to go along with the downgrade then I agree it was VERY bad form.
MO,
Danny
mickey .. You always say how astute these institutional investors are,
I don't think I ever said that but if I did I misspoke. All I have ever tried to point out is that institutions look at investing pretty much 180 degrees opposite from individual investors. If I said that makes them right and individual investors wrong then I apologize because that is not what I was trying to convey.
I couldn't agree with you more about the ridiculousness of today's price action. Absolutely makes no sense whatsoever. The only thing I will say is if you and I are right about that the market WILL come around to that thinking in the future, but I don't have a clue when.
MO,
Danny
Hook .. sad part is the boy really believe his BS.
There is an important admonition on WS: "Bullsh*t the world but NEVER bullsh*t yourself." Dmiller is the best validation of that axiom that I have ever encountered LOL.
MO,
Danny
Revlis .. Yup .. their egos can't accept anything less. Anyone who thinks they "know" or even "think" they know why the stock price took a dive today are smoking some pretty high grade stuff. You know more than most on this board about IDCC and I salute your willingness to admit that you don't have a clue about what happened today. I join you wholeheartedly in sharing that feeling.
Of course, what would I know since I have never stayed at a Holiday Inn Express and am 14 years removed from working on WS compared to someone who has never spent even one day there? Psssst Dmiller .. I still talk on a regular basis with some of my former WS colleagues and there is far more that has remained the same than has changed LOL.
This market is irrational. Period. It WILL become rational again. The question is when.
MO,
Danny
dmiller .. You and Ocean may have stayed at a Holiday Inn last night but your interpretation of TC's actions today as well as Davenport's is as ludicrous as the folks that appear in those commercials. That you would actually think that Davenport performed the "kill shot" and that the report was sent to IHUB for maximum effect tells me that you really need to get over yourselves. Your opinion of how important you are to the future stock price of IDCC is beyond the pale.
I have no idea why the stock got hammered today. Davenport and HL would be pleased to learn that you two think it was because of a cleverly contrived conspiracy between two COMPETITORS. But, they would be the first to say you give them WAAAAY too much credit and that you don't have a clue what they do day after day after day for work. It is far less exciting and creative than you make it out to be.
And BTW, I've never had anyone's back on this board with the exception of Jimlur and Loop. I don't know TC .. he could be the biggest jerk and most incompetent analyst on the Street for all I know .. but I do know how sell-side analysts do their job and you and Ocean clearly don't.
MO,
Danny
dmiller .. OK, so why is it that you can't wait for me to chime in on TC? I have no idea why Tom was not on the call .. maybe he was busy doing something else .. he does follow other stocks you know .. maybe he was sick .. maybe he was on vacation and MAYBE he was just handholding with his clients considering how far the stock AND the market have dropped since he went to neutral, NOT sell. If it was the latter I would agree with you that he confirmed his true colors .. his only allegiance is to his clients and you ain't one of them nor is anyone else on this board.
Like me, he couldn't care less what you think. It is irrelevant to him but what he thinks and communicates to his clients does have some (small, big, who knows) relevance to the stock price movement. None of us can do a damn thing about it just like we can't have any effect on those whose opinions are driving the market down into oblivion. Deal with it.
MO,
Danny
bobsil .. AMEN! .. eom
rmarchma .. By including Samsung into the calculations in 2008, they were able to get 175% payout for this cycle.
Which makes perfect sense to me if one takes management at their word that Samsung was signed in 2008 and the only issue remaining was the manner of payment which Samsung "officially" chose on January 14, 2009.
MO,
Danny
goblue .. Look in the dictionary under knee-jerk reaction and one of the definitions you will see is: "a negative response by IHUB to the tiniest hint of a negative in any of IDCC's public disclosures"
Sheesh ...
MO,
Danny
Goodbuddy .. Excellent link .. Love how the individual holding data can be sorted by clicking on the column head. The colors make it easy to rapidly get a feel for institutional ownership movements. Finally the rankings chart puts it all in perspective for the world, this country and industry.
Thanks!
Danny
Jim .. Market isn't closed I don't believe until after AH is closed.
Jim .. it will release its fourth quarter and full year 2008 financial results after the market closes on Monday, March 2, 2009.
revlis and Jim .. What you are probably seeing here is the rationale behind low interest rates being a stimulus. Spending their own money is not "free" for a company. Only investments that have a ROI in excess of the company's internal rate of return (typically in excess of 15%) qualify for consideration.
The "cost of capital" is invariably higher than the cost to borrow. In times like these the spread between the two is likely at a historical high and could be 10% or more. It would be imprudent not to borrow for major investments instead of using capital.
MO,
Danny
Lou .. Now lets see .. who do you think owns more stock? TC or Teecee and his clients? Who is more concerned about what is posted on this board TC or Teecee? Who has a greater need to disparage this board and TC, both financially and personally than Teecee?
And finally, who is getting played more, Jim by TC or you and the others on AB by Teecee?
MO,
Danny
Mickey .. I don't even know you so I neither care, or don't care, for you. It seems from your responses to my posts that I'm not on your list of best friends.
Institutions are never going to think the same way you (and most here) do about investing and you and others are never going to think about investing the way they do. You are at opposite ends of the spectrum when it comes to the willingness to take risk, the importance of diversification and the need to produce returns net of fees that are better than the indices as consistently as possible year after year. They are as focused 24/7 on the downside as you are on the upside, particularly in this environment. When average annual returns for managed money have been around 10% for decades a 24% profit in a week is nothing to sneeze at and could signal a time for these slow and steady institutions to take a breather. Finally, and most importantly, institutions are very disciplined about limiting their exposure in any one industry and to individual stocks within that industry. It is entirely possible that TC's clients are "all in" when it comes to their target positions for IDCC right now.
I am as optimistic as you are (well almost lol) about things happening this year that could advance the share price significantly. I suspect TC is as well. While his ratings and target prices may seem ludicrous to you, I'm betting that they make all the sense in the world to his clients because they speak the same language. It is a VERY different language than what is spoken here. It really is not much different than the significant disparity of interpretations of legal issues between non-lawyers on this board and the very professional and knowledgeable legal eagles we have on the board. The laymen think in terms of "justice" and "fairness" and the lawyers focus on the law and how it can be utilized to best benefit the client. Seldom do the two coincide.
MO,
Danny
Revlis (and Jim) .. There is NO way an analyst from a major firm would hire HL to advise him or her. Egos and status would prevent that subject from even being raised.
I would almost guarantee that TC's downgrade to neutral (hold) from buy has nothing to do with his or his family's position in IDCC. We are making WAY too big a deal out of his new rating and that is because most here are looking at it through the prism of long-term holders looking for a grand slam home run in a stock in which they are significantly overweighted.
Institutions are primarily singles hitters and seldom if ever swing for the fences. It is in that context that TC made his downgrade. The stock ran up quickly after his upgrade .. much quicker than he thought, I suspect .. and he was just giving his clients a heads up not to chase it in the short-term. NO BIG DEAL!!!!!
MO,
Danny
George .. That caught my eye as well .. particularly the "major" part. I'd say chances are good that a new analyst(s) would speak with Tom before initiating coverage. Also, it might be an acknowledgement by TC that he has limited reach in the institutional community and the next significant leg up will come from clients of a major firm who are not his clients. He won't be concerned about the competition at all because it will bring price appreciation for his clients.
MO,
Danny
Mickey .. Answering any of your questions is an incredible waste of time since it will only lead to more "dog with a bone" like responses from you that continue to clutter up this board with your insatiable need to ALWAYS be right.
I may post nothing of value but I don't do it many times a day, every day.
MO,
Danny
Mickey .. God gave us two ears and only one mouth so we would listen more and talk less. Clearly you have never gotten that message and never will. You are deafened by the sound of your own voice and prove it day after day after day. How's that working out for you?
MO,
Danny
mickey .. This also would be devastating to the shorts as they would be short more shares, yet realistically there has been no change but the normal thing after a stock split is the stock appreciates, and now every dollar of appreciation is multiplied by the number of shares that was split hopefully a 2 1/2 for 1, so every dollar up is worth $2.50 where before it was a $1.00.
You can't be serious. If you have ten shares of stock that are worth $2.50/share before a 2 1/2 for 1 split your stock is worth $25. Immediately after the split the stock will go to $1.00 per share and your now 25 shares will be worth the same $25. From that point on the stock will appreciate on a percentage basis like all stocks do. If the stock pre-split went up 10% it would gain $.25 per share or $2.50 for your ten shares. After the split the same percentage gain would be $.10 per share or $2.50 for the 25 shares.
You could split it 10 for one and you will still only have $25 of value after the split and it is that $25 that appreciates based on the ongoing fundamentals. That appreciation does not change in total, it will just become 1/10th per share of what it would have been pre-split. Many an individual investor during the bubble was hoodwinked into buying stock that was going to split because they thought their money would multiply by the split ratio. Investors are far more educated now. Note that Buffet has never split Berkshire Hathaway because he recognizes that it does NOTHING for shareholder value.
MO,
Danny
Nessco .. Unbelievable! It is probably an automated headline made up of the first few words in the story. Sheeesh!
MO,
Danny
dmiller .. That is an average price trade which is an accumulation of trades during the day for one buyer that is reported after the close. Notice the four places after the decimal. Stocks may trade in penny increments now but not in .0015 increments.
MO,
Danny
badgerkid .. Hilliard Lyons' analysts receive bonus compensation based on Hilliard Lyons’ profitability. They do not receive direct payments from investment banking activity. The author of this report or members of his household have a long position in the common stock of InterDigital Communications, but may not engage in buying or selling contrary to the recommendation.
You are right that money motivates and that TC is motivated by money like everyone else. From the above disclosure do you think TC is most motivated by his bonus compensation or his trading profits in stocks that he covers? WS has always been about bonuses as the recent uproar over what was paid out last year would indicate. It is the #1 motivator and there isn't even a #2 for WS employees. Moreover, from the disclosure we don't even know if TC owns any shares or options .. it could be just his family members. Importantly, if he does own any we don't know if it is significant enough to motivate him to look away from the big prize, his bonus.
Hillard Lyons makes profits off the work product of their analyst employees if those analysts make money for the firm's clients. It really is as simple as that. Now if TC is fiddling with his ratings so that he or members of his family can make money trading in IDCC that puts HL's reputation with their clients AND HL profits at risk. One irate phone call from a major client to HL management complaining about rating manipulation for personal benefit and TC will have all the time he wants to trade stocks because he won't be an analyst anymore. After all, this is why these types of disclosures were made mandatory after the analyst scandals in the late 1990s.
I admit that TC's abrupt downgrade is puzzling but I suspect it is driven more by uncertainty about the market and the economy than anything about IDCC. There is a whole big world outside this board and it is worrying orders of magnitude more investors than those on this board. Maybe this had something to do with his move to "neutral":
http://www.msnbc.msn.com/id/3683270/
MO,
Danny
bim524 .. I haven't read anything in his reports that this board doesn't know already. In fact, there is no doubt that his research starts here. You can almost cut and paste some of the posts/ideas on this board into his report.
You may be giving the board too much credit LOL.
I think you may be missing the point re: Carpenter and all of the covering analysts. This board focuses on one stock to the exclusion of all others as well as market and economic factors. Moreover, there are some VERY high quality and energetic posters here. TC covers several stocks as well as industry developments and economic scenarios. Accordingly, it would be surprising for TC to know something of significance that this board doesn't about IDCC.
The real point is that I suspect that very few, if any, institutions read this board AND IDCC keeps a very low profile in terms of PR. Ergo, the only ones that are getting the word out to the institutional buyers are the covering analysts. As for a personal agenda, I doubt that one exists beyond being right in his research. There is no such thing as a "neutral" analyst. Not strongly believing in the opinions they are publishing .. pro or con .. is definitely a career limiting move.
MO,
Danny
Count .. Outstanding post .. one of your very best and you have had a lot of good ones over the years. Maybe Tom is right and maybe he is wrong. But, unlike we on this board who make predictions, TC will have to live with the consequences of his in terms of his career.
MO,
Danny
L2V .. Liquidity is tres importanto to institutions. They don't like to have to chase a price up because of low supply when they accumulate and they don't like to chase a price down because of low demand when they are reducing or eliminating a position. The willingness of institutions to deal with the current low liquidity of IDCC is another sign of the stock's strength.
MO,
Danny
Jim .. Isn't it normal before coverage is made public a firm would buy for their clients before announcing coverage?
Not to be picky .. but before coverage is made public the clients will buy BUT not necessarily with the covering firm .. if the clients don't get an advantage in terms of timing there is little or no value to the coverage. What may be hardest to understand is that the clients may "pay" for the coverage in trades with the broker employing the covering analyst in stocks other than the one being covered. There is very seldom if ever a direct correlation between compensation for coverage on a given stock and the trades a client does with the covering firm.
IMO there's a lot of computers that are set up were the bell would ring when a stock would be the best performer in it's sector and also ring again because it keeps making new 52 week highs.
Highly likely .. but I am not happy about that because the same "non-human" interpretation and action can happen on the downside. I'll take the TCs of the world over computer algorithims any day.
MO,
Danny
Hi Frank,
Really nice post you made re: Tom Carpenter. Hope all is well.
Brad
gattica (and revlis) .. I like this part best:
Sector Performance: IDCC is a member of the Telecomm Equipment sector, where it is the best performing stock out of 75 stocks in the sector. While the sector as a whole has a weighted Alpha of –41.72%, IDCC itself has a weighted Alpha of +57.4% indicating that it is significantly stronger than the sector as a whole. To learn more about weighted Alpha, visit the Barchart Learning Center.
MO,
Danny
revlis .. Did you not see the "PR" from TC? .. eom
MO,
Danny
Loop .. Precisely .. eom
georgebailey .. That is the first time someone suggested that I am selling management short LOL. Usually I am taking flack for sticking up for them. My post was a gentle poke for some here to entertain the possibility that management.
Check out my post to sailfree a few moments ago.
MO,
Danny
Sailfree .. BUT IDCC structured the options .. that is where the real management expertise/vision came into play particularly since they knew it would have significant impact on structure and value of the NOK and other licenses going forward. SAM simply analyzed which one of the available options they would take, a fairly mechanical task.
As you know, I have been a consistent fan of this management team from the outset. I also know that evaluation of management is high up on the DD lists of institutions. Lots of folks here initially questioned management's judgment in even offering a fixed fee license to SAM. Based on the stock price action once the analysts and institutions had finished taking a close look at the deal, it seems to me that they have a high regard for the business acumen of IDCC management. If I'm right that is a VERY good thing for us.
MO,
Danny
Loop .. I'm beginning to think that WM and his team evaluate many more factors, including the Global Economy, than we realized in deciding the licensing strategy that will maximize shareholder value over the next 5 years. It's either that or the very first verified instance of dumb luck for IDCC. Here is another article that is making the SAM fixed fee license look better and better:
http://www.msnbc.msn.com/id/28823013/
MO,
Danny