InterDigital Inc (IDCC)

[Desert dweller]

sinnet, well said. All these years of waiting and I continue to hope that Wall Street looks at it the same way. In this market it is good to have a floor on the stock but it signals that it won't be a huge boost IMO and from past experience, I can never predict what the stock price will do so we may wake up to the stock trading in the 30's tomorrow but I doubt it. I hope it does especially since I took a gamble this morning and I bought some Jan 30's but my guess at this point is that they will expire worthless in 2 days unless we get something from the company stating more royalties will be coming from Sammy.

Message In Reply To:
You can only wish that wall street thinks in the same way you did.

First, however IDCC and Samsung structured the deal ain't gonna fool analysts on the wall street. We all know that IDCC is about to get 200 million for past 2g usage from samsung. All the analysts covering IDCC knew it. You knew it. I knew it. The IDCC management structured the deal hoping that all the money we received can enjoy a multiple just like normal earning revenue. I believe those analysts will consider these information and assign a discounted multiple to IDCC. If normal multiple is 15-18, we probably see 10 for example.

Second, Nokia is no fool either in this game. IDCC can bring this "apparent 3g rate" from samsung and demand nokia to pay the similar rate but I can bet with you that Nokia will refuse. Nokia will calculate the "effective 3g rate" that samsung pays by subtracting the $200 million arbitration money from $400 million, then divided by the units samsung projected to sell until 2012 and then further tries to apply a volume discount on that number. That will be the rate Nokia wants to pay.

Third, when license renewal comes up in 2012 with samsung, samsung will do the same math and demand the "effective rate" for renewal. Either we concede or we have to see samsung in court again.

Whether this kind of deal structuring benefit or hurt IDCC, we shall see in the future.