George,
I am not an expert in SPEX. There really is too much unknown information for any investor outside of the inner circle (SPEX insiders) to really have a grasp on all of the moving parts. And there are a ton of moving parts.
What I have been able to do is evaluate the underlying assets the company now controls (mainly from the transaction with Rockstar) vis-à-vis its capital structure. It's no secret the North-South agreement complicated the picture regarding shares outstanding.
Before when the company was trading in the double digits, and even the high single digits, it seemed clear there was an exuberant value being placed on a company that was in a pre-revenue stage. Now that the stock has dropped to the $1.70s and the $1.80s price range, it appears the reverse has occurred and the market is undervaluing these assets and the company's opportunity/ability to monetize them.
I have no crystal ball, and timing bottoms is often next to impossible. That's why I buy in tranches and set thoughtful entry/exit targets. Earlier purchases have been stopped out trying to catch this one on the recent slide. I'm hoping this time it holds $1.70 or higher, but this 2014 market environment has been nasty for many stocks in the IP sector.
IMHO, the current valuation (on a fully-diluted basis) of approx. $50 mm presents a good speculative opportunity for retail folks. It's not that often Joe Retail can buy at $1.80 when private placement is taking place at $3.75/share as well as a 1/2 warrant at $6.15 -- just a few weeks earlier. I wouldn't be surprised for this to trade over $3 at some point this year. Possibly over $4 or higher. But a lot depends on their monetization campaign and what else they can do. From an execution standpoint, it's not realistic to expect litigation victories in a short-term time period. These things tend to move at their own pace, often with many unexpected curve-balls thrown in.
