Cannacord report Wi-LAN* (WIN : TSX : $3.96), Net Change: 0.03, % Change: 0.76%, Volume: 145,485
The calm before the storm?
Wi-LAN reported Q1 with a beat on the bottom line. Q2 guidance, however, was below Street expectations. Canaccord Genuity Tech Analyst Robert Young believes this is the calm before the storm. Young continues to see a high probability of new licensing with a very busy litigation schedule in the July-November period. Young continue to like Wi-LAN given: 1) ~ 4% dividend yield; 2) recurring license revenue and roughly four years of backlog; 3) litigation pipeline; and 4) an excellent balance sheet with $1.38 per share in cash. Just a few days ago, WiLAN signed a new multi-year agreement with Panasonic to license its portfolio of digital TV and display patents. Panasonic is a leading vendor with a strong brand name. Wi-LAN indicated that the licensing arrangement was attractive to Panasonic not only to the V-chip patent but also due to the remainder of the display portfolio. Wi-LAN currently has digital TV related litigations against Toshiba and LG, with the Toshiba case scheduled for trial in October. The Panasonic deal would increase the probability of settlements in both of these cases. Also, earlier this week, Wi-LAN announced it has initiated new litigation claiming patent infringement in the Southern District of Florida against BlackBerry (BB). The suit against BlackBerry claims infringement of patents which relates to LTEcompliant mobile handsets.