Vertex royalty question This was posted on another board by the person who wrote the latest Seeking Alpha article in response to a question about Vertex potentially restructuring the 17.5% revenue clause. Any thoughts?
"The information services industry has net margins of 13.78% and software systems and applications has 17.34% so the 17.5% royalty has more value than 100% ownership in those companies. They already own 100% of this company vis-a-vis the royalty. Your ownership interest as a shareholder is subordinate to them and is worth zero. You just don't know it. If they wanted to cash out they could just sell the royalty stream. Is it possible that they will restructure? Yes, it's possible but not very probable given what they have today is more valuable than 100% of the company. It just intrigues me that people would invest in a company that, as currently structured, has zero value for shareholders. The best you can hope for is the greater fool theory."