Quarterhill Inc (QTRH.TO)

This is a death dealing company that will get after you if you use their patents. At the moment it might be trying to sell itself.

Litigation is its product. Sometimes it wins and sometimes it loses and it lost a big one in October and the stock fell out of bed. No one has any way of predicting what this company is going to do so he views it as entirely speculative.

Missed expectations for 2 years now. It is now down at a new level. Half of the company’s value is cash and still have 3000 patents that they could sign. His view is that they should sell the company. In his view, they will never get a super premium multiple as a great growth company. It will be a “show me” company for years and years to come. If you can get a sale of the company for $5-$6-$7, take it and go because you are not going to get that in the market.

Was very disappointed with the results of the trial with Apple (AAPL-Q) yesterday. Expects they will appeal. Balance sheet looks great, which includes $1.40 per share in cash. Pays a nice dividend. There are not a lot of catalysts coming up in the next 6 months in other trials. Wait until it starts trading sideways for a while, or under $3 would be a good entry point.

An interesting concept in that it is a royalty gatherer, no capital commitment. They signed 3 or 4 licensing deals in the last few weeks. Likes it. He watches it but needs more liquidity for his company. 3.84% dividend.

Market is focused on their Oct 15th bun fight with Apple (AAPL-Q) with regards to handsets. If they are successful, a target of $6-$6.20 is possible. They are doing lawsuits in partnership with other companies which he likes. Feels there is pretty good opportunity for it but it is a speculative outcome regarding Apple.

Beaten up because they have not announced a lot of licensing deals. This is the big year when most litigations are going to court, but many of those should be getting settled out of court. It is very event driven.

A portfolio of patents. Just had a couple of wins. A lumpy kind of company. Expenses are lumpy also. You can make a case to hold it here but it is too lumpy to him. You could pick it up cheaper on a lack of news.

Big pop again today, news related. A painful holding at some points. They hold patents and try to get economic value from them. They took a case to court recently and lost. Alcatel and HTE won the case. But there is still value in their patent portfolio. Here are catalysts coming soon. That is why they continue to hold it.

Lost their 1^st court case ever. When you buy stocks, you want to buy those that you think will deliver positive surprises and this one is doing the opposite. It was a richly valued stock and he feels people are now realizing that it is not a one-way trip.

(Market Call Minute.) A really interesting company. Lost a big lawsuit.

This benefits from the technology trade that comes up from October through December. He gains on average about 25% during that period. Looking at the charts right now, it does not look ideal. Chart shows lower highs and lower lows. Would like to see it form a significant bottom before going into it.

The most frustrating name of all the companies he covers. Started with a fairly high rating. They missed a couple of quarters so he lowered his ratings on lower expectations going forward. Lost a big lawsuit and haven’t performed the way he expected. When you are paying lawyers $14 million a quarter, it is very hard to make money. Have $157 million in cash. Nice dividend that is relatively secure. Still good potential if they sign a bunch of deals. Last quarter they signed 5 deals and are starting to get momentum. He and investors are frustrated.

This is one of his larger tech positions. Was very surprised at its 32% drop yesterday. This was as a result of court case they lost in Texas. This is the 1^st time they had ever gone all the way to a court trial. The trouble with companies like this is that you really can’t get a lot of depth in terms of what the patents are really about. They have a couple of other cases coming up in the back half of this year and hopefully they will be more positive.

Just lost a patent case and the stock dropped 30%. He doesn’t know how you can invest in the stock like this. To him it is kind of like playing roulette. Too speculative for him.