Maxim Group Boosts Target on Vingo (VRNG), Sees a Easy Double
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Price: $1.97 --0%
Rating Summary:
2 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 0 | Down: 0 | New: 0
Rating Summary:
2 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 0 | Down: 0 | New: 0
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Maxim Group boosted its price target on Buy-rated Vringo (NYSE: VRNG) from $6.50 to $10 Monday, or more than double the current price level of $4.54.
"It appears that the judge has denied GOOG's motion for summary judgment as there is sufficient difference on factual grounds to necessitate going to court next week on October 16," analyst John Tinker states. "The judge stated that GOOG and VRNG must meet tomorrow, Tuesday, October 9, at 10.30am in Norfolk, Virginia to see if they can negotiate a settlement. VRNG's expert witnesses are seeking about $696M plus interest for historical licensing and could be asking for another $700M for future royalties (until 2016). GOOG is in a tricky position; if they pay a patent troll, this could open the doors to further cases. On the other hand, a company that professes to "do no evil" should pay a licensing fee for someone else's idea that they are using, in our opinion. One possible outcome is that GOOG buys VRNG and then uses the patents in turn as a strategic weapon against Microsoft (NASDAQ: MSFT) for similar infringement.
Tinker boosted his price target to $10, after raising his damages estimate from ~$924M to ~$1,400M, or $15 per share on a pre-tax basis. He is also reducing the discount rate from 50% to 40% as the trial becomes a reality.
With the recent direct offering of $45 million, the company has ~$50 million in cash and is well positioned to enter negotiations with Google, the analyst notes. Also, the addition of the Nokia (NYSE: NOK) patents, worth an estimated $0.70/share, reduces the binary risk and they anticipate that it should shortly be filling lawsuits on behalf of its global Nokia patents, which the analyst said "should build on its momentum during the court case."
For an analyst ratings summary and ratings history on Vringo click here. For more ratings news on Vringo click here.
Shares of Vringo closed at $4.54 yesterday.
"It appears that the judge has denied GOOG's motion for summary judgment as there is sufficient difference on factual grounds to necessitate going to court next week on October 16," analyst John Tinker states. "The judge stated that GOOG and VRNG must meet tomorrow, Tuesday, October 9, at 10.30am in Norfolk, Virginia to see if they can negotiate a settlement. VRNG's expert witnesses are seeking about $696M plus interest for historical licensing and could be asking for another $700M for future royalties (until 2016). GOOG is in a tricky position; if they pay a patent troll, this could open the doors to further cases. On the other hand, a company that professes to "do no evil" should pay a licensing fee for someone else's idea that they are using, in our opinion. One possible outcome is that GOOG buys VRNG and then uses the patents in turn as a strategic weapon against Microsoft (NASDAQ: MSFT) for similar infringement.
Tinker boosted his price target to $10, after raising his damages estimate from ~$924M to ~$1,400M, or $15 per share on a pre-tax basis. He is also reducing the discount rate from 50% to 40% as the trial becomes a reality.
With the recent direct offering of $45 million, the company has ~$50 million in cash and is well positioned to enter negotiations with Google, the analyst notes. Also, the addition of the Nokia (NYSE: NOK) patents, worth an estimated $0.70/share, reduces the binary risk and they anticipate that it should shortly be filling lawsuits on behalf of its global Nokia patents, which the analyst said "should build on its momentum during the court case."
For an analyst ratings summary and ratings history on Vringo click here. For more ratings news on Vringo click here.
Shares of Vringo closed at $4.54 yesterday.
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