The news flow has been missing. This is reflected in the low volumes over the last few days. Usually, quiet periods are the best times for stocks to consolidate and prepare for the next move. News was expected from WMS Industries (WMS) regarding the settlement, and also there were reports of the case management conference on the patent infringement lawsuit. Whenever there is some development on this front, things will change for the stock. The case management conference will help discuss dates for a settlement conference, completion of discovery, motions, the final pretrial conference and trial. Further, a confidential settlement memorandum will be required from the parties. These are steps in the process, and will lead to more clarity regarding the possibilities. Acquisition of FanTD LLC is expected to help the company get operational experience of online / mobile gambling and the sports wagering business. News on the closure of the deal and more details about the financial projections of the business are also expected soon. The numbers will help investors understand the true potential of the business, and it is very important that the management explains the details. All these expectations may keep the stock reasonably strong and active. However, one has to be prepared for intervening volatility and take appropriate action depending upon ones risk appetite. A Seekingalpha article had given a target in excess of $17 for MGT in October. This was based on the performance of other plaintiff company stocks involved in patent infringement lawsuits. That may be a very steep target, but such things have been known to happen. Perhaps, if the FanTD venture succeeds, that would be the bigger positive for the long term success of MGT. This would change the business model, and also make analysts / investors view the company differently as compared with pure patent plays.
