has published a research report on LogMeIn (NASDAQ: LOGM) after the company's second nuclear event in one week.
In the report, Piper Jaffray wrote, "Despite a second nuclear event in one week, we remain buyers of LOGM based on the long term theme of connected devices. Today it was announced that an appeals court vacated its favorable judgment in LogMeIn's case vs. 01 Communique. The result is that LogMeIn will have to go back to trial which we estimate will cost $7.5m over 3 quarters beginning in Dec-12. We believe that there are three potential outcomes including LogMeIn winning its trial, LogMeIn having to pay an ongoing licensing fee on the portion of revenue affected by the suit, LogMeIn paying a onetime royalty. We estimate that a one time patent fee would be between $10m-$20m. We estimate that a licensing fee would be between 5~10%, and impact ~50% of LogMeIn's revenue. We estimate a royalty payment of 10% would bring 2013 PF EPS from
.92 to
.60."
Piper Jaffray maintained its Overweight rating but lowered its price target from $45 to $35 on LogMeIn, which is currently trading down about 22 percent from yesterday's $24.39 closing price.
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Tags: Piper Jaffray
Posted in: Analyst Color, Price Target, Analyst Ratings
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