InterDigital Inc (IDCC)

[NukeJohn]

Potential Catalyst Events

There are so many potential catalyst events, it's hard to even list them, all but I'll give my top ten (in no particular order).

1. Friendly buyout offer at a huge premium from a big fish (Apple, Qualcomm, Intel, Microsoft, Oracle, etc.). Some people might say Oracle, are you crazy...where did that come from? (In a recent Conference Call, Larry Ellison mentioned they were interested in acquiring IP companies).
http://www.investorvillage.com/smbd.asp?mb=65&mn=42842&pt=msg&mid=9611997

2. Hostile buyout offer from a handset manufacturer that needs a competitive IP portfolio (Nokia, Samsung, RIM, etc.). This would be likely rejected by management and probably would start a bidding war. With all the litigation Apple has going on right now....I can't imagine Apple would allow another company to acquire IDCC.
http://www.investorvillage.com/smbd.asp?mb=65&mn=42983&pt=msg&mid=9753825

3. Nokia Settlement on 3G (with or without an additional LTE license). I expect this before the end of January, and possibly before oral arguments. Nokia knows their odds at the CAFC are slim and none, and recent comments made by Bill Merritt in the NASDAQ OMX conference earlier this week indicate that the IP is no longer in question...just negotiating an equitable royalty rate. The NASDAQ OMX Analyst Presentation can be accessed here under conference calls.
http://www.interdigital.com/

4. LG 3G license renewal (with or without an additional LTE license). I expect this before the end of the year because I don't think LG can risk going without a license for a minute due to a possible buyout situation.

5. New 3G handset licensee from any top ten handset manufacturer that is currently not licensed (Huawei, Motorola, Sony/Ericsson, ZTE, etc.) Bill Merritt also said in the NASDAQ Conference that they were in active licensing discussions with all these companies.

6. Special dividend of $1 - $2/share. While this is still possible, I think odds have gone down due to the likelihood of the tax bill passing.

7. Regular dividend annnouncement of .20/quarter or more. Most IDCC investors expect a dividend in the .15/qtr range, but a larger dividend will certainly be welcomed by a multitude of institutions and funds that invest primarily in dividend bearing stocks. Funds should flock to a company like IDCC when the dividend is announced because IDCC also has the opportunity for huge earnings growth. The 3G market (growing at 20% with only 50% currently under license) and the pending ramp of the LTE market offer funds the safety of continued growth in combination with the dividend.

8. A license with a major US carrier (AT&T, Verizon, Sprint, etc.) or a major foreign carrier for IDCC's Wireless Convergence Technolgies and technologies associated with the Network of Networks. This the market that is 5-7 times larger than the $150 Billion dollar handset market that Bill refeered to in a recent conference call. To see Bill's comments check this link.
http://www.investorvillage.com/smbd.asp?mb=65&mn=43138&pt=msg&mid=9854387

For specific info on the technologies IDCC has to offer the Carriers, look at these Press Releases.

http://ir.interdigital.com/releasedetail.cfm?ReleaseID=445006
http://ir.interdigital.com/releasedetail.cfm?ReleaseID=469553
http://ir.interdigital.com/releasedetail.cfm?ReleaseID=444780
http://ir.interdigital.com/releasedetail.cfm?ReleaseID=442977

9. A new M2M license that puts IDCC with over 70% of the M2M market under license.

10. Any one of the major handset manufacturers signs an LTE license.


I'm sure there are a lot more I have not listed. FWIW, I think we will see at least three or four of these occur in the next 2 months.

JMHO,

NJ