RE:Disaster? Market is correctly pricing in the cash flow impact of another adverse judgment.
Vizio, Sharp and now Valve are going to be owed legal cost and fees for bringing forward a nuisance lawsuit without merit. It also highlights the risk of losing the Alexa case with Amazon and how much they will be eventually be owed.
Suing with "chaff" is a low return business and you are exposed to downside from suing defendants unwilling to settle for nuisance fees.
How does any prospective buyer value a business when they could be on the hook for tens of millions of adverse outcomes?
How does a buyer value the ability of a team to select partners and patents when they haven't won anything in court with a partner acquired patent?
All of these losses reduce the cash.
Lastly, the fed is committed to raising rates in the short term and keeping them there for a period of time. Any government that is embarking on a long term highway project is going to wait the 18-24 months when rates are lower and the cost of building a road is cheaper.
The issue is can the company remain solvent until those accelerated principal repayments start coming due and all of these losses pile up and the continuing operating losses from ITS and WiLan. And can they hang on until the ITS pipeline converts into actual sales. I don't know.
My perspective is that 3% is not enough of a yield to wait given the risks here. Sorry!