InterDigital Inc (IDCC)

[hock1]

What I continue to find interesting is Merritt's frequent mention of the $800M revenue goal (from licensing) in the 3-5 year time-frame. Even in today's widely-viewed release he mentioned it.

This is the way I see it: currently we are collecting fees at about a $280M run rate, with no visible catalyst for substantive growth. and yet he continues to insist that we will get there. Yes, today's victory will nudge along settlements and agreements with the non-payers. But, he would be a fool to think that this alone will speed up the process.

If they were to achieve the $800M in 3 years it would equate to about 42% growth per year. At five years, it would still be an impressive 24% annual growth. I would think that they believe in 3 years it will happen but gave themselves some wiggle room with the 5 years. In any case, it is a helluva prediction.

Bottom line, I strongly believe there is at least one imminent deal, maybe more, that will include the sale of patents and an on-going royalty stream with one or more big players (like Apple). To me, this is the only way that they can achieve that very significant growth. JMO.