Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
With all due respect, Mickey, shut up! LOL. Seriously, you seem to have a lot of time in your hands so why don't you orchestrate a short squeeze for us.
IDCC has 1,800-1,900 shareholders of record. If you take out the insiders/5% owners (~5M-6M shares) and the 200 or so institutions which own approximately 15M shares then that leaves you with 1,600-1,700 individual private investors who own approximately 35M shares. That's an average of 20.6k shares to 21.9k shares per private investor.
The RB club had something like 900 members. The iHub club has something like 1,200 members so if you can persuade most of the people here to take delivery of their stock certificates within the next 2 weeks then you might, just might be able to create a short squeeze while the stock is still around its 52-week high.
If you succeed in persuading enough individual investors to withdraw their stock from the pool of stock in street name that the shorts (5M-6M shares) can borrow then the institutions will follow suit and refuse to lend their shares to the shorts too.
Who knows, Mickey. You just might be able to recover most of your losses and stop annoying people like me in the process. We can even call it Mickey's Squeeze.<g>
Good luck!
if we dont get the best engineers and they will only come if we have good salaries and an option package.idcc is competeting with companys that give big time options
Great point. Some people seem to believe that all IDCC has to do is sit on its patent portfolio and wait for the royalties to come in, but, as IDCC's history itself shows, it's not that simple. More than 95% of all patents go back to the public domain without ever earning any income. It actually takes smart businessmen to monetize any patent portfolio.
For example, none of the naysayers have any clue that at the end of 2002, IDCC generated more royalties per share (>$7/share) than other other company in history and that IDCC is poised to generate more royalties per share (>$7/share) in the next 4 years than the previous 22 years since its 1981 IPO.
However, IDCC has to keep on updating and improving its patent portfolio in order to make it easier for the majors to license its 3G portfolio. That means that IDCC has to keep on recruiting new talent.
In particular, Ericsson and Motorola appear to be under severe pressure from its institutional investors to lower its cost structure. Restructurings are inherently demoralizing so some top quality engineers are just waiting to defect to the right place and you can bet that the bidding war for those world-class talent will be ferocious.
IDCC has outperformed 99% of the wireless industry during the last 2 years and it has the best chances of any wireless company in generating the most returns during the next 2 years. IDCC's management and employees deserve to be rewarded accordingly. That's just common sense.
Why should IDCC's management and employees only get average sized-salaries and option packages when they have delivered superior results?
Why would a hotshot wireless engineer want to work for IDCC when they only get average-sized salaries and option packages for superior results?
What many small-minded people here fail to grasp is that a meritocracy that rewards performance attracts increasingly higher quality talent. IDCC is a turnaround company that is now starting its growth stage and it deserves the room to grow into that kind of meritocracy.
Fortunately, Art, the change of hands from weaker hands to stronger hands continue, at the individual investor level and at the institutional level.
BSW
P.S. No yummy ribs for the naysayers, y'hear! LOL.
Good one. Analysis paralysis and semantics....
The Procrustean Bed
Myth says that the ancient Procrustes would make visitors fit into his bed by stretching their bodies, or cutting off their legs.
From this story we get the metaphor about forcing things into a Procrustean Bed.
Instead of trying to force reality into the Procrustean Bed of fixed definitions...
...what would happen if you made renewable descriptions?
As time goes by, you adjust your definitions to take into account the new things you have learned.
http://www.generalsemantics.org/eprime/bed.htm
There you go again twisting my words beyond recognition. LOL.
I do not buy you arguement that only IPR companies should be included
Where exactly did I say that ONLY IPR companies should be included?
I expect that you will just slink away and not even apologize for this rude act but this is exactly the type of word-twisting that occurs daily with IDCC.
Think about it.
However I am of the opinion that at the present price IDCC is overvalued. It is based on future potential. Without some ground breaking news to sustain it the price will fall. We can not justify the present price without news
I think this was true before the settlement, but I think this is changing now. If nothing else, IDCC's stock appreciation during the last two years indicate a broadening of its ownership base at the individual and institutional levels.
Let me put some numbers behind this. As of 4/7/2003, IDCC had a total O/S of 55.5M. Insiders and 5%+ owners control approximately 10% or 5.5M leaving 50M shares as the float.
Institutions currently own 28% or 15.5M shares. Individuals or Private Investors currently own 72% or 34.5M shares.
1) The private investors who bought this stock before the 1995 Motorola debacle and during the survival stage (1995-1998) probably have the highest tolerance for risk and are probably driven more by instincts than by the empirical evidence. Capital is akin to gambling chips for these, uhm, swashbucklers.
2) The private investors who bought this stock during the turnaround stage (1999-2003) like me probably have a higher than average tolerance for risk too but instincts are ultimately grounded by the empirical evidence.
3) The private investors who bought this stock after the 3/14/03 settlement, or what I call the start of IDCC's growth stage, probably have the lowest risk tolerances and the highest requirements for empirical evidence from a high beta stock like IDCC.
One can intuit that these 3 basic types of private investors have different expectation levels which inform their buy and sell strategies so I don't think one can generalize too easily about their sensitivity to news after the settlement.
Most are still pure "buy and hold." Many are "core and trade." Some are pure "mo mo." The latter is the most sensitive to news and tends to have the hair-triggers. The pure "buy and hold" crowd tends to be the most vocal about the news or the lack of it. The "core and trade" crowd is just, ahem, damn cool.<g>
At the institutional level, all one has to do to appreciate the widening range of investing disciplines is look at the one of the leading fund families like Fidelity and Vanguard. A look at the charters of its speculative funds, growth funds, balanced funds, index funds and income funds would suffice to sensitize one to this widening range of investing disciplines.
Again, it is the mo mo fund crowd that tends to react right away to news or the lack of it.
What IDCC needs to keep absolutely clear amidst that noisy sea of expectations is this: If IDCC succeeds in making x amount per 2G handset and at least 2x amount per 3G handset then it is perfectly capable of generating at least 20% consistent sales and earnings growth for the rest of the decade no matter how slow or how fast the migration from 2G to 3G. When backed by useful financial milestones, this investment thesis is compelling.
This is why IDCC has to keep on investing heavily to manage the various expectations of its broadening ownership base.
From Kopin Tan's options column in this week's Barron's:
Qualcomm's puts traded actively under the specter of continued feebleness. The recent rally may have lifted 91% of the S&P 500 stocks above their 50-day moving averages, but Qualcomm was among those that had missed the ride, Natexis Bleichroeder's technical analyst John Roque points out. From March 12 through to Thursday, Qualcomm fell 13.5% while the Nasdaq surged 16.5%. Roque believes that is another reason Qualcomm is a better sale than it is a buy: If the wireless technology stock was overlooked when buyers swamped the market, what are its odds should the market pull back?
From March 12 through May 8, IDCC climbed from $13.20 to $23.38, or by 77.1%, while Nasdag rallied 16.5% and QCOM dropped 13.5%!
205 institutions own 28% of a small cap/mid-cap IDCC while 1,995 institutions own 73% of a dividend-paying big cap QCOM. If the funds flow continue to move away from big cap growth funds to mid-cap growth funds then IDCC is likely to be one of the biggest beneficiaries. QCOM is a fixture in many big cap growth funds while IDCC is still making its way from the small cap fund world to the mid-cap fund world.
My float analysis suggests that IDCC should gradually increase its float to the 75M to 100M range to accomodate this heightened institutional interest especially if IDCC accomplishes its apparent goal of making the numbers settle down this year to a useful baseline from which to judge future growth.
That's one of the reasons I want to see IDCC continue to highlight their M&A strategy and their $1B+ cash/stock war chest. It increases its appeal to a fee-starved Wall Street and, at the very least, start their internal due diligence which must include a critical analysis of why both Nokia-IDCC and QCOM-Ericsson were settled in early 1999, a few months before the 3G Patent Platform was inaugurated in Paris in June 1999.<g>
the item that has no bearing on IDCC
Relating executive compensation to market cap creation has no bearing on IDCC? LOL. Then stop wasting my time!
After 98 the risk diminished dramatically because that is when the cash started flowing again but you conveniently ignore this fact.
I disagree. IDCC exited 1998 with $52M in cash and investments. Most of the $99M revenue it booked in 1998 was one-time in nature. 1998 Recurring royalty income was less than $1M and IDCC was looking at a 1999 total operating expense of around $55M if they hadn't reduced its operating cost structure.
Where was the money for 1999 going to come from?
IDCC generated negative cash flow from operations of $13M in 1996, negative $24M in 1997 and positive $31M in 1998. IDCC was going to be cash flow negative again in 1999 if they hadn't entered into the deal with Nokia. $52M was certainly not going to last long.
You consider that less risky? No wonder we disagree on the rest of your points.
Please direct your screed to someone else next time, ok?
C'mon DD. You were just venting. There is no way to respond to that kind of rant against the system.
Take this excerpt for example:
I hope Warren Buffet has a positive impact on publicly traded companies over the next several years in curbing the excessive use of options and the excessive pay handed out by the truckload to publicly traded companies management.
If you had bothered to check further you will find that Robert Goizueta's compensation package remains the standard for executive compensation today. Goizueta was the Coke CEO from 1981 to 1997. He made a total of $1.3B over 16 years in total compensation. That's an average of $83M a year!
Warren Buffett remains a director at Coke. He had no problem giving that kind of compensation package to Goizueta because Goizueta increased Coke's market cap from $4.3B in 1981 to $152B in 1997. That's an average of $9.2B in market cap added every year for 16 years!
Now, ask yourself honestly, are you willing to pay $83M a year to somebody who can increase your company's market cap by $9.2B every year?
http://www.bizjournals.com/sanfrancisco/stories/1997/09/29/newscolumn5.html
The following will let you compare IDCC's outside directors with those of the top 200 U.S. companies. Obviously, IDCC views their directors as more than TWICE as valuable as those at the BIGGEST 200 U.S. corporations. In 2001, IDCC outside directors got an average of 42,000 options plus the $15,000 retainer plus expenses. The options and retainer, using the Black-Scholes options pricing for 2001 of $8.16 per share from IDCC's 10-K, were worth $357,720. Directors at the TOP 200 U.S. companies got an average total compensation of $152,626 in 2001. What a sad joke on us as shareholders.
I have nothing against people who take outsized risks getting outsized rewards. Even before the 1995 Motorola debacle, IDCC was a risky career move and business association because bankruptcy was always a real possibility. Again, common sense should apply here. Higher risks, higher rewards.
IDCC's Board of Directors
First Year at IDCC
....
....
Campagna - 1994
Bolgiano - 1974
Goldberg - 1993
Colson - 1995
Clontz - 1998
Roath - 1997
Will somebody please stop this crack crew of do nothing con artists from fleecing IDCC of $2.14M a year!!! Who knows? After creating more than $1B in shareholder value from 1998 to 2003, they might do the unconscionable and create more shareholder value in the next 2 years than anybody has managed to create in the last 22 years.
Is this really a problem?
You just brought out some new information that I was not aware of regarding restricted shares.
Oh no, you don't get away with this.
IDCC's restricted stock authorization is 3.5M shares. Outstanding is 900k+ shares. 2.5M+ shares are still available. You have been adding this 2.5M+ share number to a pool of options/rs/rsu/w to get a 5M+ number that you and others claim are still available for grant to support the argument that they don't need 5M more. That's misleading.
Removing this 2.5M+ restricted shares available reduces your estimate of available options/rs/rsu/w by more than half. Does that make your argument against the additional 5M options only half as relevant also?<g>
Remember that restricted stock and restricted stock units are currently considered as compensation and charged to earnings. Options are currently not.
Then you claim I used “flawed data” regarding executive compensation at IDCC and thus draw invalid conclusions thereon. First my compensation data came from IDCC’s proxy material mailed in 2002. Four of the five highest paid IDCC executives in 2001 had total compensation packages of over $1 million when the value of granted options were factored in. Almost every reasonable businessman would conclude that is way too much compensation for a company the size of IDCC. The total 2001 compensation of these five highest-paid executives of $5,458,000 represented over 10% of IDCC’s total revenues of $52.5m in 2001. I don’t have to compare IDCC to any other company to know that this was excessive.
Of course you do. For example, your use of the 2001 $52.5M sales number completely ignores the fact that under the 1999 Nokia deal, Nokia was contractually obligated to start paying recurring royalties in early 2002 subject to MFL provisions.
The larger point is that executive packages are measured over a period of time (3-5 years) to encourage them to balance short-term goals with medium-term and long-term goals. Taking one transition year out of context hardly reflects well on you.
From 1995 to 1998, IDCC generated more revenues from paid-up licenses and engineering contracts than recurring royalties. It exited 1998 with a recurring royalty stream (pre-SAB 101) of $1.5M for the entire year!
From 1999 to 2002, IDCC still generated more revenues from paid-up licenses and engineering contracts than recurring royalties at the start of the Nokia contract, but it managed to exit 2002 with a recurring royalty stream of more than $20M (post-SAB 101) in the 4th quarter alone!
The quality of IDCC's pre-settlement revenue stream was already improving before the 2003 settlement! I realize that this type of qualitative assessment tends to get drowned out by your type of rigid quantitative approach, but clearly this company is being run by risk-takers, not management by numbers types. That's why they've created more than $1B in market capitalization during the last 5 years!
An individual owner did a study of 17 small-cap technology companies. His findings were that IDCC’s salary and bonuses were significantly more than the other companies, even though these comparable market-cap company’s average revenues were twice that of IDCC.
Like I said this data is misleading. There is nothing to stop you from using this data alongside the basket of IP companies I provided to get better perspective. The reason you won't even do that is because it doesn't support your excess compensation thesis.
Consider that the basket of IP companies I mentioned have higher compensation levels than the original basket of 17 small-cap companies. And consider that IDCC's packages, while higher than the 17 small cap companies, are actually at the bottom of the range compared to other IP companies like ARMHY and RMBS.
That undercuts your claims. Period.
In some minds he is even a detriment to the company because of his background (or lack of relevant background)
Are these the same minds that also want him to buy a blonde toupee?<g>
I don't know the size of Qualitex, but if its marketing claims are true then it actually has the kind of market ubiquity that we want IDCC to get for its technology.
Leading the industry in fit, performance and durability, Sun Glow® Press Pads are consistently used by more award-winning dry cleaning plants, by a margin of 8 to 1, than any other press pad on the market.
Every major original equipment manufacturer in the United States installs Sun Glow® pads on their dry cleaning press machines at the factory as part of their original equipment. In terms of quality and performance no other press pad compares to Sun Glow® press pads.
http://www.qualitexco.com/http/pads.html
Business acumen is business acumen. That's actually harder to find than scientific or engineering talent. I think the best indicator of the effectiveness of his leadership is that IDCC was able to participate in the growth of the industry when handset volumes went from 115 million units in 1997 to 423 million units in 2002. None of the brainiacs who lead IDCC before HC could have done this.
Post-settlement revisionism is always tempting and it just makes it easier to second-guess..................everything.
You make a lot over IPR companies having much more “litigation risks”, which is inherent in any company and more so with product-based companies. Therefore I don’t understand how a pure IPR company without any product liability has more litigation exposure, and thus has to pay more compensation than anyone else.
You're quibbling over this point? Unlike most product companies with insurance, a pure IPR company that loses its patent cases usually goes out of business.
Why should a wireless engineer work for a company with high litigation risks for anything less than above average market compensation. Higher risks, higher rewards, remember?
I understand your excessive compensation thesis forces you to skew the data a certain way, but try to get some distance and use common sense. Keep in mind that IDCC was forced to scramble to finance its operations and recruit talent after the 1995 Motorola debacle - the Survival stage.
Your post is too long so I'm going to break it down in more digestible parts so I have more time to address each part.
Let me start by demolishing your central premise.
It’s impossible to draw any valid conclusions from such a small sample............If you could come up with about 10 or so small-cap IPR technology companies with similar revenues to IDCC, like Rambus and ARMHY, then I would give much more credence to your study and conclusions.
LOL. I don't think you realize it but you just proved my point. The reason the sample is small is because very few companies have actually succeeded in making the licensing model work!
QCOM, for example, already generates more royalty income ($954M) than the entire global hardware IP industry (logic, memory, analog) which only generated $757M in licensing revenues in 2002.
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18920523
Outside of IBM, QCOM IDCC, ARMHY and RMBS, only Intergraph and Lucent have any credible shot at building a significant royalty business in the next 3-4 years. There are many patent houses like Timeline and Storage Computer, but their data is misleading because these patent houses typically consist of 2 lawyers and a manager of first impressions (sexy receptionist).<g>
Now just because very few companies succeed in the licensing business -- high litigation risks, high margin rewards -- doesn't mean that you have keep on using misleading metrics.
Thanks Frank. It gets even better.<g> If I recall correctly, this is the second 10Q that IDCC has released a day or two after the earnings report.
It looks like the options war is going nuclear. This article supports my point that the option expensing rule debate is not just an accounting debate, but a public policy debate. That's why a small company like IDCC should be prepared to take advantage of this policy debate, whichever way it goes.
Accountant in the lion's den
Commentary: Big tech tries to muscle FASB
By Rex Nutting, CBS.MarketWatch.com
Last Update: 7:40 PM ET May 8, 2003
WASHINGTON (CBS.MW) -- Accountants threaten American technological and military superiority, senators and tech industry leaders said Thursday.
A proposal by the accounting standards board could smother the American dream of starting a business, or owning a home or going to school, they said.
It could mean "nuclear winter" for the tech industry, one congresswoman said.
And it could reverse the trend toward significant employee ownership, what some called "partnership capitalism."
Overheated rhetoric and doomsday scenarios? Not to the lawmakers and industry representatives who organized a roundtable discussion on Capitol Hill about the accounting treatment of stock options.
The discussion was meant to be a blunt lesson in politics for the object of their scorn -- Robert H. Herz, chairman of the Financial Accounting Standards Board.
Herz was supposed to meekly listen to their complaints that his board could threaten the vitality of the economy with its "reckless" quest to force the tech industry to put billions of dollars of employee compensation on its books.
The message to Herz: One way or the other, the combined power of Washington and Silicon Valley will prevail over the FASB, just as it did in 1994 when the Congress blocked a proposed rule that would have closed the stock option loophole.
Herz, however, refused to go along with the script.
He insisted that he is open-minded about a solution to how to properly account for the value of stock options. But he wouldn't back down on his "strong personal belief" that stock options are a cost that companies must expense in their financial reports to the Securities and Exchange Commission.
Herz said the FASB, the quasi-public group that writes the generally accepted accounting procedures and standards, are scheduled to have a final proposal on the expensing of stock options by the fall.
Sens. Barbara Boxer, D-Calif., George Allen, R-Va., and John Ensign, R-Nev., have introduced a bill that would block the FASB rule by requiring the SEC to study the issue for three years. The bill is gaining support as big technologies companies enlist the support of the other business lobbying groups.
Some have suggested that the current rules on stock options encouraged the stock market bubble. As Federal Reserve Chairman Alan Greenspan has said, "At least some of the unsustainable euphoria that surrounded dot-com investing at its peak may have been exacerbated by questionable reported earnings."
Profits of the S&P 500 companies would have been 10 to 20 percent lower than reported if companies had been forced to write down the costs of stock options, according to estimates from Standard & Poor's and other analysts.
But the defenders of stock options say investors aren't fooled by as-reported earnings, because the costs of options are explained in a footnote in annual reports.
Further, they say, there's no good way to accurately value the cost of giving someone an option to buy shares at a set price many years in the future. How does the company account for options that are "underwater" and never likely to be exercised?
"It just doesn't make sense" to force companies to reduce their earnings for options that may never be exercised, said James Barksdale, a venture capitalist who held top positions at Netscape, FedEx and McCaw Cellular.
The tech executives say options aren't a cost to companies at all, but to the shareholders. "The cost is borne by the shareholders" through dilution of their ownership, said Dennis Powell, senior vice president at Cisco Systems.
Every other form of compensation, including stock grants, are now expensed, Herz said. The inequality of accounting treatment created an unlevel playing field that encouraged companies to grant stock options instead of compensating employees in more straight-forward ways.
If employees and their abilities are major assets of tech companies, the books ought to reflect the costs of acquiring that capital, Herz said. When companies use stock to buy real assets such as buildings or inventories or even intangibles like goodwill, the cost is reflected on the books, he said. Human capital should be treated no differently.
Other than Herz, his FASB colleague Michael Crooch and SEC acting chief accountant Jackson Day, nearly every participant at Thursday's roundtable opposed any expensing of stock options.
Expensing options would lead to many fewer options being granted, making it harder for U.S. companies to attract, retain and motivate the top talent, Barksdale said.
"I don't think there could be a worse time to adopt such a policy," said John Doerr, a venture capitalist at Kleiner, Perkins, Caufield and Byers, and a top adviser and fund-raiser for President Bush.
"America is now numbers 1, 2 and 3 in every important technology," Doerr said. Expensing would "set back American innovative leadership in a major way," opening up the way for entrepreneurs in Taiwan, Singapore or even China to take the lead.
The innovation that allowed American smart bombs and unmanned airplanes to overwhelm Taliban and Iraqi defenders was the direct result of putting a value -- but not a cost -- on stock options, Sen. Allen said.
Expensing options would mean "nuclear winter" for America's technology industry, warned Rep. Anna Eshoo, D-Calif.
"This is going to have a humongous impact on the American economy," said Tom Scholl, a partner in Telogy Networks.
The lawmakers and tech leaders were clearly upset with Herz's combative stance.
"I had assumed that you'd listen," said Sen. Mike Enzi, R-Wyo. "I'm disappointed by the appearance that everything has been already decided."
"It sounds like you're a judge in a court who's already decided we're guilty," Barksdale said. "Now you're just going to decide whether to hang us or use a guillotine."
Responding to complaints that the Black-Scholes option valuation method is seriously flawed, Herz told the executives: "We'd like to work with you to get it better."
To which Andy Bryant, chief financial officers at Intel, replied: "Make it better before you make me do it, because you are asking me to commit perjury."
Rex Nutting is Washington bureau chief of CBS.MarketWatch.com
http://www.marketwatch.com/news/yhoo/story.asp?source=blq/yhoo&siteid=yhoo&dist=yhoo&gui....
LOL. Good one! EOM.
Please let’s never say again that Mr. Campagna does not get paid for his “part-time” work as Board Chairman of IDCC.” The words “excessive compensation” come to my mind regarding IDCC’s outside directors.
I dunno', Ronny. It's bad enough that you insist on using deeply flawed data to judge IDCC's executive compensation program but now you want to go after the board too!
More than 70% of the Fortune 500 have ONLY one person holding the titles of Chairman of the Board and Chief Executive Officer. Many people now believe that it is easier for a large corporation to have an independent board if the Chairmanship and the CEO positions are held by different people. IDCC is still a small company with a headcount of only 300, but yet you argue that the Chairmanship is only a part-time position. Clearly, IDCC is headed in the right direction with company tradition already of separating the Chairmanship and the CEO positions.
By the way, S&P 500 CEOs raked in $6.4B in total compensation last year when the S&P 500 tanked by 24%. That's an average compensation of $12.8M per CEO for negative shareholder value creation. The top CEO was Apple's Steve Jobs who raked in $90M in total compensation in 2002 while its stock dropped by 35%!
Again, you strain credulity when you say that IDCC's management is overpaid considering that they increased the stock by 50% in 2002 after increasing it by 79% in 2001. Do you know that ONLY 4 of the 75 technology companies in the S&P 500 generated positive returns in 2002????
http://www.thestreet.com/funds/stephenschurr/10085883.html
I understand you think that IDCC's compensation should be compared to other small tech stocks, but to this day you have have been unable to respond to my direct point that a more useful and honest basis for comparison is a basket of other companies with comparable licensing models because the litigation risks in a licensing model forces a company to pay higher compensation to compete effectively for managerial and technical talent in an open market characterized by the presence of a very large number of players who continue to use the options systems very aggressively to boost cash flow. As you know, IDCC had practically no access to the equity markets after the 1995 Motorola debacle.
Hey this is a free country. If you want to be known as a corporate gadfly with a penchant for questionable data, please feel free to go ahead. Be prepared, however, to be tuned out for being a flake.
BSWhy
P.S. I think restricted stock units are generally treated like restricted stock.
Yes, next week should be interesting.
May 11 - Mother's Day
May 13 - IDCC earnings
May 14 - Piper Jaffrey presentation
May 16 - Option Expiration Friday
May 17 - Armed Forces Day
Hardware IP vs Wireless IP (1)
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18920523
Hardware IP vs Wireless IP (2)
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18920534
PERCENTAGE OF SHARES HELD BY INSTITUTIONAL INVESTORS
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18924204
PERCENTAGE OF SHARES HELD BY INSTITUTIONAL INVESTORS
Classified by Equity
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18924113
PERCENTAGE OF SHARES HELD BY INSTITUTIONAL INVESTORS
Classified by Number of Shares Outstanding
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18924171
PERCENTAGE OF SHARES HELD BY INSTITUTIONAL INVESTORS
Classified by Total Assets
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=18924468
LOL. You just don't know how to stop, do you? Follow the bouncing ball.
This is exactly what I said:
I'm cautiously optimistic about 3G and I probably have a better way of monitoring 3G network deployments than 90% of the people here.
This is how you twisted that direct statement in that maze you call your brain:
You know more about 3g networking than 90% of the world.....He knows more than 90% of the world about 3g networking......
I believe that is what you call a self-inflicted wound that you can probably blame on IDCC management too. LOL. You can try to make people forget about this party trick that your mind is playing on you, but unfortunately, you keep on doing this over and over again. Remember "engines and transmission"? Same thing. Look at how you process those crappy datapoints about executive compensation and restricted shares that are just being passed around here without much critical thinking or verification.
That's why I think you're a waste of time now the 2G ligitation issues are behind this company. Thanks for the past contributions, I suppose, but it's time to move on and for you to pick yourself up from the gutter, don't you think?
Good luck!
Check again, Loop. Here's the relevant excerpt:
RESTRICTED STOCK
ADVANTAGES
1) No executive investment required
2) Promotes immediate stock ownership
3) charge to earnings is fixed at time of grant
4) if stock appreciates, company's tax deduction exceeds fixed charge to earnings
5) aligns executive's interests with shareholders
6) recognizable to most executives
7) offers executive potentially long-term appreciation as company grows.
DISADVANTAGES
1) Charge to earnings
2) Immediate dilution of EPS
3) Executive my incur tax liability before shares are sold
4) If stock depreciates, company's fixed-earnings charge exceeds tax deduction
http://216.239.33.104/search?q=cache:G0pmmtYLRZEC:resourcesconsultinggroup.com/pdf/longterm_incent_p....
And this is what I said about 3G:
I'm cautiously optimistic about 3G and I probably have a better way of monitoring 3G network deployments than 90% of the people here,
Don't be such a drama queen.
Why don't you decide for yourself, Loop. You're the one with the expectation problem, remember?
I think you're wrong, Ronny. Aren't performance shares or stock units charged to earnings to the degree that the stated performance goals are met during the performance period?
http://216.239.33.104/search?q=cache:G0pmmtYLRZEC:resourcesconsultinggroup.com/pdf/longterm_incent_p....
You know you're in too deep a stock when you lash out at imaginary slights. LOL.
Are IDCC's restricted stock and stock units already expensed on its income statement?
The authorization is 3.5M shares, but only 900k shares are outstanding.
LOL! Why are you comparing the performance of a $20B company and a $1.3B company? The expectation levels are different.
You only succeeded in cluttering about my point about how IDCC can learn from EMC's proven ability to keep on expanding its addressable markets. BTW, how many companies do you know have gone from less than $200M in sales to nearly $9B in sales in 10 years?
Thanks Frank. If I recall correctly, Russell has 21 sub-indexes. Do you have the latest numbers of the amount of index money that follows the different indexes?
I agree with you about IDCC's ability to generate both sales growth and EPS growth -- remember the 10/10 and 20/20 elite club I described, but I don't agree with you that there is no distinction between a sales-based multiple and an earnings-based multiple.
A sales-based multiple allows comparison of IDCC with other companies the an early stage of their growth since all have sales and you have a consistent basis for judging if you're paying too much or too little for each sales dollar.
An earnings-based multiple simply doesn't allow that kind of comparison because most companies are unprofitable at their early stage of their growth.
IDCC is unique in the sense that..It can raise its gross income stream ten fold and add not one dollar to cost of merchandise, labor, general overhead etc..90 cents on each increased dollar revenue should fall to the BOTTOM LINE..
IDCC is unique but not quite in that way. For example, a company has to keep on updating its patent portfolio to keep up with rapid technology cycles and to introduce new innovations. The average patent costs $4M to prosecute and maintain over its 20-year lifetime. The more patents are issued, the higher the maintenance fees which form part of overhead. In 2002, IDDC generated 43% of all its patent applications (typically 1-2 years) indicating that it will probably generate more patent applications in 2003 than in 2002 and so on. That means a higher patent overhead in 2003 than in 2002 and so on.
Yes, it will take time, but once IDCC gets on those indexes it will probably stay there a looooooong time until it is dropped from the indexes. Just as an example, more than $200B of index fund money follow the Russell indexes.
the downside with institutional ownership is that they generally won't whine but will sell in a minute
As opposed to individual ownership that will not only whine endlessly and also sell in a minute? Just kidding.
I think you're overstate the role of the individual investor, the most disciplined of whom actually benefit the most from increased institutional ownership.
I also think you have a narrow view of the wide range of investment disciplines at the institutions. Hedge funds, for example, have been around a long time but only became popular during the last decade.
When do you think IDCC will get on some indexes and index funds?
About 84 percent of the votes cast at the data-storage company's annual meeting opposed the resolution....
.......EMC, which believes most of its executive pay already is performance-based, said mandating such awards would limit the flexibility of its executive compensation policies.
EMC is probably my favorite company of all time. It reinvented itself several times -- and expanded its addressable market each time -- as it went from $190M in sales in 1990 to $8.9B in sales in 2000. Market cap went from a few hundred million in 1990 to more than $220 Billion in 2000!!! The stock practically doubled each year during the 90s!!!
There's a lesson there for tiny IDCC.
You're hopeless. We agree to disagree on IDCC's growth plans.
Bother someone else.
More institutions, less whiners....hehehe....would love to see the Qualcomm (61%) or Rambus (21%) fund crowd pick up more of this one....
I think we're going to see more of this. Small cap fund guys like Nasgovitz distributing their shares to mid-cap guys as IDCC keeps on going up and stretching the envelope of their fund charters or their investing disciplines, whichever comes first.
Average S&P 500 institutional ownership is around 62%-63%. IDCC is less than 30%. Lotsa' room, lotsa' room.
Why be brief when you can continue to be a working example of why verbose accountants shouldn't be consultants? <g>
Common sense tells you that a typical company goes through different stages of growth before it reaches maturity (read: slow sales growth). At each stage it exhibits different sales, earnings and cash flow characteristics. Since the market is an anticipatory discounting mechanism, it will pay effectively pay differently for companies with different sales, earnings and cash flow characteristics. After all, different types of investors (individual and institutions) have different expectation levels. At the institutional investor level, for example, you have funds that can only invest in companies with dividends but then you also have highly speculative funds that don't invest in companies that pay dividends.
All you have to do is look at IDCC itself. Is it trading on the basis of current earnings? Of course not.
Considering that the typical licensing contract lasts 5 years, can you reliably project IDCC's mature earnings capacity beyond 5 years right now? Of course not.
Look around and try to observe different companies at different stages of growth so you won't get lost in abtractions. Every company ultimately aims to produce steady earnings and cash flow that can be readily discounted. The investing question that a growth investor seeks to resolve is how a company gets there, if it can.
Where we part company is over the numerator. In order to make your argument for defeat as strong as possible you reject out of hand any chance that these options might motivate management to work harder and smarter to maximize future earnings to the shareholders' benefit.
Great point! That's the same kind of tunnel vision we just saw during the latest gripe sessions about insider selling.
The most amazing thing about the negative reaction to the insider selling after the settlement was that the malcontents kept on rejecting all the available data that showed that insider activity during the last 2 years DID NOT precede any decline in IDCC's price since IDCC's stock returned 78% in 2001 and 50% in 2002!!!
Yet people kept on insisting that insiders sold because they knew something! And some even asked IDCC to further narrow the selling windows for insiders beyond that required by the SEC!!! Is it any wonder why IDCC ignored them?
The questionable assumption made, of course, was that the stock could have gone higher after the settlement if the insiders hadn't sold.
A similarly questionable assumption is being made now that the stock could go even higher if the options are not issued!
Apparently there are people who actually want IDCC to have an EPS-based multiple instead of a sales-based multiple during the early stage of its growth. These are the folks who don't seem to understand that sales-based multiples result in higher market caps for growth companies that still need to finance their growth plans.
Notice the pattern? LOL.
ERICY is a good place to start, Loop. It controls 30%+ of the wireless infrastructure market. The lag time between network deployment and commercial handset sales is 3-9 months depending on the carrier.
SYSTEMS
Orders and sales for Network Equipment and Professional Services are now reported separately. As before, Network Equipment, including Network Rollout services will be subdivided into Mobile Networks and Fixed Networks.
First quarter Fourth quarter
---------------------------------------
SEK b. 2003 2002 Change 2002 Change
--------------------------------------------------------------
Orders booked 25.0 37.7 -34% 28.5 -12%
Mobile networks 17.5 29.3 -40% 20.9 -16%
Fixed networks 2.0 2.7 -26% 1.9 4%
Professional Services 5.5 5.7 -2% 5.7 -3%
Net sales 24.0 33.3 -28% 33.2 -28%
Mobile networks 17.6 25.6 -31% 24.7 -28%
Fixed networks 1.9 3.3 -42% 3.0 -38%
Professional Services 4.4 4.5 -1% 5.5 -20%
Adjusted operating
income -2.1 -2.8 - -0.3 -
Adjusted operating
margin (%) -9% -8% - -1% -
--------------------------------------------------------------
The decline in orders booked year-over-year for Systems is mainly attributable to lower network equipment demand as operators continue to limit capital expenditures. The 34% decline includes ten percentage points due to negative effects of currency exchange rate changes and seven percentage points due to lower equipment orders for TDMA/PDC. Orders for the GSM/WCDMA track declined 28%. However, Professional Services were up adjusting for foreign currency effects.
Orders in Western Europe and Brazil were flat year-over-year while orders were down in all other regions.
Orders for GSM/WCDMA were down 10% sequentially while other mobile equipment, including CDMA, were down even more. Orders for Professional Services were down 3% sequentially, mainly due to seasonal effects.
Orders in Latin America improved sequentially, mainly due to orders for GSM and EDGE equipment in Brazil. Demand in the US and China was weak with most other areas of Asia holding up relatively well. The Europe, Middle East and Africa (EMEA) region was generally weak with the exception of the UK and Spain.
Of the 28% year-over-year decline in Systems sales, seven percentage points were related to negative currency exchange rate effects. Sales of the GSM/WCDMA track declined 12%, less than the mobile systems market overall. TDMA/PDC declined almost 90%. Sales of TDMA/PDC now represent less than 5% of Systems sales. Sales of WCDMA equipment and associated network rollout services represented 12% of mobile network sales.
Although system sales were almost SEK 10 b. lower than in the first quarter last year, the losses were reduced by SEK 0.7 b. to an adjusted operating income of SEK -2.1 b. Excluding risk provisions for customer financing of SEK 0.1 b. (0.6 b.) the result was SEK -2.0 b. (-2.2 b). The sequential decline before customer financing provisions was SEK 2.4 b. mainly due to the SEK 9.2 b. lower sales.
http://biz.yahoo.com/bw/030429/286024_1.html
Thanks, DD. You should post more often yourself.
but that can't possibly explain all of it.
IDCC Owners/Managers versus Owners. Greed? Jealousy? Hemmoroids?<g>
Do you remember when Congress passed a law in 1993 that limited the corporate tax deductibility of executive compensation over $1M? Talk about the law of unintended consequences! That law was passed amidst the public outcry for fairness in the wake of the S&L crisis, the insider trading and the junk bond scandals of the go-go 80s.
Of course, in 1994 the same politicians stopped FASB from expensing options paving the way for the 1995 Netscape IPO which started the trend of unprofitable dotcoms carpet-bombing the equity market. This phenomenon had the practical effect of completely loosening the restraints on executive compensation, forcing companies to bid for managerial and technical talent to record heights.