InterDigital Inc (IDCC)

[mickeybritt]

Red Angus

Why do you think the stock is trading where it is presently? Had IDCC not retired 450 million worth of stock? Lets add another 25 million shares outstanding and put the money in the bank and do you think we trade at this price or lower or higher? My vote is it trades a hell of a lot lower. So you sit on cash and see your stock sit at a lower price. IDCC has almost a predictable cash input which will be growing big time especially if they add more new licensees, and they are hiring someone to even add to getting new licenses, as so many companies are still unlicensed. So IDCC would not be putting itself in a bad financial position by using the cash to increase shareholder value. However if they are in a position to aquire a company that would increase shareholder value even more then that is the avenue to take. I do feel that even if IDCC spent money retiring stock and a great deal came up that IDCC would be able to get the money or aquire with stock even if it required issuing additional shares. It isn't like they wouldn't have the ability to aquire good deals just it might require a loan, no big deal if it is a big time profitable situation as you write the loan money off as expenses.

Right now if IDCC sold the Jan 10 $35.00 puts they could take in $8.00 and if they sold the Jan 10 $30.00 calls they could take in another $8.00 for a total of $16.00 they could buy some stock with that money but making sure they have the cash to cover if the stock got put to them. This is a hell of a lot better return on the company money than sitting on the cash. In fact they would be plain stupid not to implement a program like this, as cash gets no return and they have a fiduciary responsibility to enhance shareholder value and make as much as they can with the money they have, and this makes them money.


Just my opinion

Mickey