Last two trading sessions have been good and the stock seems to have found support around $13. The current bounce is only two days old but the volumes have been good. If the next week remains good, and the stock is able to close above the 50 DMA of $13.52 (weekly closing), then the trend will become more positive. In the short term, the main resistance is around $14.50 and if that can be crossed, then one can be sure of a real uptrend. The main trigger will be the upcoming earnings on April 30. If RPXC beats the street, then the path will become easier. The fundamentals of the company have improved over time, and the growth in earnings has been good. In Q1'12, the company recorded a revenue of $43.85 million and a net income of $8.08 million. In Q4'12, the figures were $51.56 million and $10.10 million respectively. The requirement of the services which the company provides, is likely to grow with the market for patent monetization. Several companies have made it big with this business model, and recent examples include Vringo (VRNG). The latest company to join the list is Document Security System (NYSE:DSS). A subsidiary of DSS recently filed a lawsuit against Facebook (FB), LinkedIn (LNKD), Broadvision (BVSN) etc. The expected damages run into hundreds of millions, and DSS investors are eagerly awaiting the upcoming Markman hearing. In a recent report, patent business expert & researcher JP Moreno highlighted the potential of the growing market, and supported companies like DSS which have a diversified business model. For RPXC, the business model is such that it is not solely dependent on monetization lawsuit awards or licensing revenues, but has access to the potential of those events. In any case, it is safer to buy or add after the results. Alternatively, one can trade with a stop loss below $13.
