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Net income of $35 million, or $0.78 per diluted share, a 32 percent increase over 2Q09 EPS of
$0.59;
Revenue of $91.2 million, a 22 percent increase over 2Q09 sales of $74.9 million;
P/E (TTM) is 8.7X and the forward looking P/E to estimated EPS is 9.2X
The PEG based on estimated EPS and growth is a low 0.6X
Low EV/EBITDA of 4.98X
For the FY ending 12/10, four analysts project EPS in the range of $2.83 to $3.44, providing a
consensus of $3.22
Four analysts also project EPS for FYE 2011. Here, the range is $1.70 to $3.68 with an average of
$2.58
The June 10 reported earnings was 28 percent higher than analyst consensus forecasts.
The fortunes of IDCC are tied closely with the worldwide market for cellular devices. Handset sales have
declined in the recent past but will rebound, we think, with the roll-out of 4G devices. IDCC will benefit
from the popularity of tablet computers. The company’s strength lies in not having capital tied-up in
inventory or capital equipment. It can use its excess cash to continue the stock repurchase program
started in 2009 but suspended thus far, in 2010, provide a dividend or find an accretive acquisition. It
cannot sit on the cash indefinitely; it must do something to increase shareholder value.
IDCC will be releasing its third quarter results at the end of October. It would be prudent to wait until
then before prognosticating further.