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InterDigital (IDCC) Raises Share Repurchase Tally to $300M
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In a concerted effort to return cash to shareholders, InterDigital, Inc. (IDCC - Free Report) increased its existing share repurchase program to $300 million. The share buyback program is an extension of the strategic objective of the company to reward its shareholders with risk-adjusted returns.
Management intends to repurchase the shares by utilizing its operating cash flow. InterDigital has a relatively healthy balance sheet position with adequate liquidity. In the third quarter of 2023, the company generated $310.6 million of cash from operating activities against cash utilization of $18.7 million in the year-earlier period. As of Sep 30, 2023, it had $1,083.9 million in cash and cash equivalents with $538.2 million of long-term debt and other long-term liabilities.
A well-established global footprint, diversified product portfolio and ability to penetrate different markets are key growth drivers for the company. Apart from a strong portfolio of wireless technology solutions, the addition of technologies related to sensors, user interface and video to its offerings is likely to drive considerable value, given the massive size of the market it offers licensing technologies to.
InterDigital’s commitment to licensing its broad portfolio of technologies to wireless terminal equipment makers, which allows it to expand its core market capability, is laudable. It has leading companies, such as Huawei, Samsung, LG and Apple, under its licensing agreements. The company is focused on pursuing agreements with unlicensed customers in the handset and consumer electronics markets.
The company aims to become a leading designer and developer of technology solutions and innovation for the mobile industry, IoT and allied technology areas by leveraging its research and development capabilities, technological know-how and rich industry experience. At the same time, it intends to enhance its licensing revenue base by adding licensees and expanding into adjacent technology areas that align with its intellectual property position.
Shares of InterDigital have surged 114% over the past year, backed by solid top-line growth and continued momentum in the licensing business. Earnings estimates for the current and next fiscal have increased a stellar 238.8% and 104.5%, respectively, over the past year, implying robust inherent growth potential.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
InterDigital currently sports a Zacks Rank #1 (Strong Buy).
Comtech Telecommunications Corp. (CMTL - Free Report) , presently carrying a Zacks Rank #2 (Buy), is a solid pick. Headquartered in Melville, NY, the company is a leading global provider of next-generation 911 emergency systems and secure wireless communications technologies to commercial and government customers.
Comtech’s key satellite earth station modems incorporate forward error correction and bandwidth compression technologies, which enable its customers to optimize their satellite networks by either reducing their satellite transponder lease costs or increasing data.
Arista Networks, Inc. (ANET - Free Report) , carrying a Zacks Rank #2 at present, is likely to benefit from strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architectures and enhance their cloud experiences. Arista has a long-term earnings growth expectation of 20.4% and delivered an earnings surprise of 12%, on average, in the trailing four quarters.
It holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. Arista is increasingly gaining market traction in 200- and 400-gig high-performance switching products and remains well-positioned for healthy growth in data-driven cloud networking business with proactive platforms and predictive operations.
AudioCodes Ltd. (AUDC - Free Report) currently carries a Zacks Rank #2. It has a long-term earnings growth expectation of 24.8% and delivered an earnings surprise of 14%, on average, in the trailing four quarters.
Headquartered in Lod, Israel, AudioCodes offers advanced communications software, products, and productivity solutions for the digital workplace. It provides a broad range of innovative products, solutions and services that are used by large multi-national enterprises and leading tier-1 operators around the world.
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InterDigital (IDCC) Raises Share Repurchase Tally to $300M
In a concerted effort to return cash to shareholders, InterDigital, Inc. (IDCC - Free Report) increased its existing share repurchase program to $300 million. The share buyback program is an extension of the strategic objective of the company to reward its shareholders with risk-adjusted returns.
Management intends to repurchase the shares by utilizing its operating cash flow. InterDigital has a relatively healthy balance sheet position with adequate liquidity. In the third quarter of 2023, the company generated $310.6 million of cash from operating activities against cash utilization of $18.7 million in the year-earlier period. As of Sep 30, 2023, it had $1,083.9 million in cash and cash equivalents with $538.2 million of long-term debt and other long-term liabilities.
A well-established global footprint, diversified product portfolio and ability to penetrate different markets are key growth drivers for the company. Apart from a strong portfolio of wireless technology solutions, the addition of technologies related to sensors, user interface and video to its offerings is likely to drive considerable value, given the massive size of the market it offers licensing technologies to.
InterDigital’s commitment to licensing its broad portfolio of technologies to wireless terminal equipment makers, which allows it to expand its core market capability, is laudable. It has leading companies, such as Huawei, Samsung, LG and Apple, under its licensing agreements. The company is focused on pursuing agreements with unlicensed customers in the handset and consumer electronics markets.
The company aims to become a leading designer and developer of technology solutions and innovation for the mobile industry, IoT and allied technology areas by leveraging its research and development capabilities, technological know-how and rich industry experience. At the same time, it intends to enhance its licensing revenue base by adding licensees and expanding into adjacent technology areas that align with its intellectual property position.
Shares of InterDigital have surged 114% over the past year, backed by solid top-line growth and continued momentum in the licensing business. Earnings estimates for the current and next fiscal have increased a stellar 238.8% and 104.5%, respectively, over the past year, implying robust inherent growth potential.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
InterDigital currently sports a Zacks Rank #1 (Strong Buy).
You can see the complete list of today’s Zacks #1 Rank stocks here.
Comtech Telecommunications Corp. (CMTL - Free Report) , presently carrying a Zacks Rank #2 (Buy), is a solid pick. Headquartered in Melville, NY, the company is a leading global provider of next-generation 911 emergency systems and secure wireless communications technologies to commercial and government customers.
Comtech’s key satellite earth station modems incorporate forward error correction and bandwidth compression technologies, which enable its customers to optimize their satellite networks by either reducing their satellite transponder lease costs or increasing data.
Arista Networks, Inc. (ANET - Free Report) , carrying a Zacks Rank #2 at present, is likely to benefit from strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architectures and enhance their cloud experiences. Arista has a long-term earnings growth expectation of 20.4% and delivered an earnings surprise of 12%, on average, in the trailing four quarters.
It holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. Arista is increasingly gaining market traction in 200- and 400-gig high-performance switching products and remains well-positioned for healthy growth in data-driven cloud networking business with proactive platforms and predictive operations.
AudioCodes Ltd. (AUDC - Free Report) currently carries a Zacks Rank #2. It has a long-term earnings growth expectation of 24.8% and delivered an earnings surprise of 14%, on average, in the trailing four quarters.
Headquartered in Lod, Israel, AudioCodes offers advanced communications software, products, and productivity solutions for the digital workplace. It provides a broad range of innovative products, solutions and services that are used by large multi-national enterprises and leading tier-1 operators around the world.