Replies to post #247808 on InterDigital Inc (IDCC)

[Danny Detail]

L2V .. Liquidity is tres importanto to institutions. They don't like to have to chase a price up because of low supply when they accumulate and they don't like to chase a price down because of low demand when they are reducing or eliminating a position. The willingness of institutions to deal with the current low liquidity of IDCC is another sign of the stock's strength.

MO,
Danny

[Red Angus]

LV--re stock split, etc.:
There are differing opinions on the question of cash dividends vs. stock repurchases. Other considerations involve one or more of the foregoing combined with stick splits or acquisitions or simply holding cash under the circumstances. Dozens of books and treatises are written about the various choices.

After receipt of the first Sammy funds (and first Nokia funds) my humble opinion as applied to IDCC would be this (always keeping an open mind for alternatives as things evolve):

* If/when IDCC moves into the $35-$40 range it should consider a stock split. The advantage would be an increase in liquidity of the company and its resultant availability to more investors. Doubling the number of shares at half the beginning price would be a good thing for IDCC for a couple reasons. Also, historically, after a stock split is announced stocks move higher before the split itself; after the split the up-down movement is about 50-50, and is dependent on the future continuing business of the company itself. I think the future looks good for IDCC on this score.

Such a stock-split action would be cash-neutral on the books of the company and would improve the position of all IDCC shareholders.

* Secondly, regarding the CASH of Interdigital I would prefer that it remain cash-rich for the time being. I've commented on this before. Especially in this economy a company with no debt and a bag of gold will have all sorts of opportunities (including possible smart acquisitions?). Why pay out cash dividends, resulting in more restrictive company financial choices in the future while at the same time creating adverse income tax consequences for individual investors?

And, honestly, who among us has invested in IDCC for a cash dividend, versus increase in share value? Nobody.

So I say: Go for the growth and increase in share value. The best scenario for IDCC shareholders would be a combo of stock split, followed by maintenance of an extremely strong cash position with an eagle eye for lucrative cherry-picking. If no creative acquisition makes the scene we have all our options still available. Yeah.

(But let's wait for a little pull-back so I can get a few more shares? No?)

Jmo of course.