WWCM says Wi-LAN busy busy busy
“Q1 results in-line with consensus as Nokia license drives strong EPS.
• WIN reported $49M in revs and $0.43 in EPS for FQ1. NOK deal also gave WIN 90+ patents that should contribute to the next quarter. • Strong balance sheet post recent financings and Nokia license deal. WIN’s cash balance now ~$95M; gives the company flexibility on acquisitions and potential U.S. litigation.
• Licensing deals, patent acquisitions, mergers: all possible near-term. In settlement talks with D-Link & nearing license deals with others; in negotiations with several parties to acquire patents.
• Re-iterate DCF-based target of $8.50 and Strong Buy rating. Assume WIN signs 1 more license deal in F07 & 2 in F08 (prev. 1). New wins offset by increased opex & share count; thus little change to EPS.
In related news, despite all of the good things happening at Wi-LAN, great trading volume, a recent syndicate slot and incredibly strong cash balance, GMP Securities dropped research coverage of the name this morning.